Strategy (MSTR) shares have crashed below $100: Michael Saylor's bitcoin empire is cracking at the seams
Shares of Strategy (MSTR), the largest corporate holder of bitcoin led by Michael Saylor, have fallen below the psychologically important $100 mark for the first time since March 2024. This is not just a correction—it is a serious signal that the model built on endless BTC purchases with borrowed funds is starting to falter.
The stock decline occurred against the backdrop of bitcoin trading near $61,000. The correlation between MSTR's value and the price of the leading cryptocurrency is becoming increasingly tight, and now, as BTC has retreated from its 2025 highs, the entire Strategy structure is under pressure.
Reserves Under Fire: 847,363 BTC No Longer a Safety Net
Strategy holds 847,363 bitcoins on its balance sheet—the largest corporate stash in the world. However, when the price of the underlying asset drops, the value of the company's reserves begins to erode. Along with it, investor interest in risky leveraged instruments, which abound in Strategy's capital structure, evaporates.
MSTR quotes have broken through the $100 support level, with shares last trading at this level on March 1, 2024. Technically, this is a return to levels from a year ago, indicating a complete loss of the gains accumulated during the bull run.
Main Threat: The Capital Raising Mechanism Is Breaking Down
The decline in bitcoin is only part of the problem. The spotlight is now on the STRC preferred instrument, which was created to finance BTC purchases. By design, its price should stay near the $100 par value, but recently it broke below this level. This means that borrowing costs for Strategy are rising sharply, making it increasingly difficult to attract new funds.
Strategy's formula for accumulating bitcoins is entirely dependent on efficient access to capital. As soon as this source weakens, expectations for the company's growth decline. Investors begin to reassess risks, and they turn out to be higher than anticipated.
First BTC Sale: A Taboo Broken
Confidence in Saylor's strategy was shaken after the company disclosed the sale of 32 bitcoins to fund payments on preferred shares. The transaction amount was insignificant compared to total reserves, but the very fact of the sale was a symbolic blow.
For years, Strategy built its reputation on the principle of "never selling bitcoin." Even a small sale called this dogma into question and drew attention to the company's liquidity. If the market once believed in endless accumulation, now questions arise: what if further sales become necessary?
Why MSTR Is Falling More Than Bitcoin
MSTR is not just a proxy for bitcoin. In fact, it is a leveraged proxy. When bitcoin depreciates, a chain reaction is triggered:
- Strategy's BTC reserves lose value.
- Investor confidence in the financing model declines.
- Premiums to net asset value shrink.
- Financial risks become more apparent.
As a result, MSTR's price often falls more sharply than bitcoin. This is a feedback effect that is now working against the company.
What's Next: Two Scenarios
Investors are currently watching two key levels. The first is whether bitcoin can hold in the $60,000–$61,000 range. If so, MSTR could see a sharp rise due to its leverage. But if pressure on BTC persists and financing questions remain unresolved, the price fixing below $100 may turn out to be more than just a technical event.
For the strategy of holding bitcoin on the balance sheet, this could become a true turning point. Either Saylor finds a way to restart the capital raising mechanism, or the market will reassess MSTR's value in light of new realities.
My opinion: The break below $100 is not a bottom, but merely a stage of reassessment. If bitcoin does not return above $70,000 in the coming weeks, we will see further compression of the premium and, possibly, the first major sell-off of reserves. The "buy and hold" strategy with leverage only works in one direction of the market.