Shares of Strategy Inc. (formerly MicroStrategy) have fallen from $457 to $152 over the past six months, representing approximately a 66% decrease in price. During the same period, the company’s total market capitalization shrank by nearly $90 billion, with the current valuation around $46 billion. The stock movement coincided with worsening conditions in the digital asset market and internal corporate factors that together intensified pressure on the share price.
Reasons Behind the MSTR Stock Decline
Bitcoin Price Drop
One of the main factors cited is the decline in Bitcoin’s price: it dropped from about $126,000 to $87,000 during the same timeframe. For a company holding a significant portion of its assets in BTC, such a move in the underlying asset directly reduces the estimated value of its reserves and worsens investors’ risk perception. As a result, this became a key driver in the stock price reassessment.
Share Issuance and Dilution
Strategy Inc. actively issued new shares to accumulate Bitcoin, increasing the number of shares outstanding. In a falling market, this practice amplified dilution effects for existing shareholders and added further downward pressure on the stock price. Combined with the BTC decline, this accelerated the drop in share value.
Delisting Risks and Index Effects
Among other reasons mentioned are risks of losing inclusion in stock indices, which could reduce demand from large funds and index investors. This possibility pushes market participants to quickly reassess the stock and sell additional shares. Changes in index status often lead to noticeable liquidity outflows for the stock.
Reduction of Premium to Net Asset Value
Previously, the company’s shares traded at a premium to the value of Bitcoin held on the balance sheet, but under current conditions, that premium has disappeared and been replaced by a discount. Shares are now selling below the value of the crypto assets on the balance sheet, reflected in a current discount of 20%–25%.
Impact of Bitcoin Reserves on Share Value
Strategy Inc. holds about $59 billion in Bitcoin on its balance sheet, while the company’s current market capitalization is roughly $46 billion. This disparity highlights a practical gap between market cap and the value of crypto assets on the balance sheet: shares trade at a discount of approximately 20%–25% to the reserve value. A more detailed analysis of why the shares trade below BTC value can help understand the pricing mechanism.
Market Dynamics and Investor Reaction
Deteriorating conditions in the digital asset market combined with corporate actions have changed investors’ risk perception. Fluctuations in the underlying asset price and active share issuance led to a reassessment of value and reduced demand for the stock. Additionally, the discussed delisting risks increase volatility and reduce the stock’s appeal to long-term investors; see materials on potential delisting risks in indices.
Why This Matters
If you mine cryptocurrency and consider shares as a way to gain exposure to crypto or diversify, MSTR’s current situation shows how BTC price behavior and corporate decisions can radically change a stock’s value. For miners with 1–1000 devices, this is primarily a lesson on the connection between the underlying asset’s value and the shares of companies holding crypto reserves.
Even if you don’t hold MSTR shares, these events affect overall market dynamics and how investors react to BTC news. This can influence liquidity and volatility in the BTC/fiat pair, indirectly impacting the ability to sell mined cryptocurrency and plan income.
What to Do?
- Monitor Bitcoin prices and key news about corporations with large crypto reserves — this helps assess macro risks to your income.
- If you own or plan to buy MSTR shares, evaluate the market capitalization relative to Bitcoin reserves and the existing 20%–25% discount.
- Separate mining operations from investment positions: selling mining revenue and holding reserves are different tasks with different risk levels.
- Consider possible changes in stock liquidity when planning asset exchanges and storing funds; during high volatility, keep a fiat buffer to cover equipment and electricity costs.