MicroStrategy recorded six consecutive months of stock price declines — the first such occurrence since the company shifted to a strategy of holding Bitcoin. The decline lasted from July through December of last year and included several significant monthly drops, marking this period as notable compared to the company's previous history.
Six-Month Decline in MicroStrategy Stock
The period from July to December was unprecedented for MicroStrategy shares following its focus on Bitcoin as the primary reserve asset. Monthly data show there were no positive closes during this half-year stretch, with substantial declines in certain months.
- August: −16.78%.
- October: −16.36%.
- November: −34.26%.
- December: −14.24%.
Comparison with Bitcoin Performance
Over the same six-month period, Bitcoin’s price decreased by 27.36%, which is noted separately from MicroStrategy’s stock behavior. However, MSTR’s monthly declines were deeper in some cases than Bitcoin’s average drop, highlighting a divergence between the cryptocurrency’s performance and the company’s shares.
Structural Revaluation of Shares
Analyst Chris Millhas pointed out an anomaly in price behavior and proposed the idea of a possible structural revaluation of MicroStrategy’s value. This suggests the market may have started to reassess the company’s operational business value separately from its Bitcoin holdings, applying different discount rates and valuation approaches.
Historical Context of MicroStrategy’s Strategy
The strategy of holding Bitcoin as the main reserve began in August 2020 under the initiative of Executive Chairman Michael Saylor and has been a key factor influencing the company’s stock price behavior. This linkage of shares to Bitcoin’s dynamics previously explained the increased volatility and amplified stock movements relative to the cryptocurrency.
To read about MicroStrategy’s role as a Bitcoin holder, see the article on its status as the largest holder among public companies, providing additional context for the strategy: MicroStrategy — Largest Bitcoin Holder.
Market Impact and Future Outlook
The decline in MSTR serves as an example for other public companies holding Bitcoin on their balance sheets and may influence how investors evaluate such strategies. Changes in market valuation raise issues related to risk, debt costs, and price sensitivity to asset volatility.
Additional insights into related risks and impacts on index positions are available in the review of MicroStrategy’s place in the Nasdaq 100, which explores risks associated with holding this position: MicroStrategy in Nasdaq 100.
Why This Matters
If you mine with anywhere from one to a thousand devices in Russia, this does not directly affect your operational work, but it is important to understand indirect risks. Changes in the valuation of companies holding large Bitcoin reserves can increase industry volatility and influence investor and creditor sentiment, which in turn can impact capital availability and service terms for businesses.
Moreover, sharper stock movements compared to Bitcoin demonstrate that the market premium for corporate cryptocurrency holdings is not guaranteed and can fluctuate — a significant consideration for miners contemplating partnerships or selling hash rate to large corporate holders.
What to Do?
If you operate between 1 and 1,000 devices, first assess your personal operational resilience: check backup power sources, electricity contracts, and equipment maintenance processes. This will help you withstand periods of industry volatility and avoid dependence on short-term financial market fluctuations.
Secondly, maintain a simple financial cushion and avoid excessive reliance on corporate partners with highly volatile assets. Finally, monitor public information about companies holding Bitcoin and analyze how their decisions might indirectly affect your operations and business model.