Michael Saylor reaffirms commitment to Bitcoin amid investigation and pressure on Strategy
Michael Saylor, co-founder and chairman of Strategy, made a public statement for the first time in a long while. On June 26, he wrote on X that the company remains fully committed to Bitcoin. This move comes amid a legal investigation into the company's securities and growing pressure on its capital structure.
The Rosen Law Firm has launched an investigation to determine whether Strategy's top executives misled investors regarding five securities offerings. No official comments from Strategy have been made yet. However, Saylor sidestepped this issue in his post, focusing instead on market volatility as a "test" for the company.
Saylor Emphasizes Discipline, Not Problems
According to Saylor, Strategy continues to bet on high credit quality and the creation of long-term value. Notably, he did not mention the class-action lawsuit from investors or the decline in the value of the company's preferred securities. Instead, he emphasized discipline in capital management—a signal directed at both shareholders and creditors.
Strategy holds 847,363 BTC on its balance sheet, representing over 4% of the total supply that will ever be issued. The average purchase price is around $75,500 per coin, notably higher than the current exchange rate. This gap has reduced the premium on MSTR shares, which investors paid for indirect leveraged exposure to Bitcoin.
Most of Strategy's Bitcoin was purchased through several issuances of exchange-traded preferred shares. These securities are now under pressure due to the weakening BTC price and declining market confidence in the dividend model.
Market Pressure and Criticism of Strategy
The day before Saylor's statement, prominent critic Peter Schiff once again criticized Strategy's weak stock performance. According to him, MSTR shares have fallen 84% from their all-time high, while STRC preferred shares have dropped 25% from par value—their yield reaching 15.3%. Saylor's post appears to be an indirect response to this criticism, though he did not address it directly.
Questions about the long-term sustainability of STRC are becoming increasingly acute. Dividend payments on these securities cost approximately $1.2 billion per year, while the company recently disclosed only $1.4 billion in cash reserves—enough for about a year under current conditions.
Cryptalist Analytical Commentary: The situation surrounding Strategy is a classic stress test for a business model built on leverage and long-term faith in Bitcoin. Saylor certainly demonstrates unwavering confidence, but the market has already begun pricing in risks of the company's inability to service dividends. In the coming months, we will see whether Strategy can refinance its obligations or if pressure from lawyers and a falling market becomes critical. For investors, this is a moment of truth: either believe in the fundamental value of BTC or acknowledge that Saylor's financial engineering has cracked.