MicroStrategy challenges the market: Strategy stays the course on Bitcoin despite investigation and capital pressure
Michael Saylor broke his silence for the first time in a long while. On June 26, he stated on X that Strategy remains committed to Bitcoin. This statement came amid significant pressure: the Rosen Law Firm initiated an investigation into the company regarding five securities offerings, and Strategy's capital structure is facing increasingly intense market pressure. No official comments from Strategy itself have been made yet.
In his post, Saylor sidestepped the investor class-action lawsuit and the decline in the value of the company's preferred shares. Instead, he emphasized discipline in capital management and long-term value creation. According to him, Strategy continues to bet on high-quality credit. This is a signal addressed to both shareholders and creditors: the company intends to stick to its chosen course, despite the storm.
On Strategy's balance sheet are 847,363 Bitcoins, representing more than 4% of the total that will ever be issued. The average purchase price hovers around $75,500 per coin, which is noticeably higher than the current exchange rate. This gap has reduced the premium on MSTR shares that investors paid for indirect leveraged exposure to Bitcoin. At the same time, interest is growing in how the company will finance new purchases.
Strategy bought most of its Bitcoin through several issuances of preferred shares traded on the exchange. Currently, these securities remain under pressure due to the weakening Bitcoin exchange rate and declining market confidence in the dividend model.
The Market Tests Strategy's Resolve
The day before Saylor's statement, Peter Schiff once again criticized the weak performance of Strategy's shares. According to him, MSTR shares have fallen 84% from their all-time high, and STRC preferred shares have dropped 25% from their par value. Their yield has reached 15.3%. Saylor's post appears to be an indirect response to this criticism, although he did not address it directly.
Questions about the long-term sustainability of STRC are becoming more pressing. Paying dividends on these securities costs approximately $1.2 billion per year, while the company recently disclosed only $1.4 billion in cash reserves. This would last about a year under current conditions.
Whether Saylor can restore investor confidence, or whether the investigation will escalate to a new legal level, will largely determine Strategy's fate in the coming months. From my perspective, the current situation is a classic stress test for a model built on the infinite growth of Bitcoin. If the market does not see new financing mechanisms, the pressure on the capital structure will only increase.