Okay, let's dissect this MicroStrategy (now "Strategy Inc," apparently) situation. The headline screams "shock," but is it really that surprising? The company's market cap briefly dipped below its Bitcoin holdings – about $65.3 billion versus $66.6 billion in BTC. The core question: Is this a blip or a sign that the market's finally wising up to the risks of debt-fueled crypto speculation?
MicroStrategy: Bitcoin Proxy or Albatross?
The Numbers Game
First, let's be clear: Strategy still holds a massive pile of Bitcoin, roughly 641,692 BTC acquired at an average price of $74,000. With Bitcoin fluctuating between $100,000 and $105,000 (as of whenever this data was pulled), they're sitting on paper profits. But that's *before* you account for the $8.2 billion in debt Michael Saylor racked up chasing this dream.
The real issue isn't the Bitcoin itself; it's the *corporate structure* built around it. Strategy financed its Bitcoin binge through convertible debt, equity issuances, the whole nine yards. This dilutes shareholder value. As one analyst, @onechancefreedm, put it, "You're not buying cheap BTC. You're buying BTC plus leverage, plus liabilities, plus a corporate wrapper."
The market had been giving Strategy a premium for being a Bitcoin proxy, especially before spot ETFs existed. Now that BlackRock and Fidelity are offering pure Bitcoin exposure, that premium is gone. Why pay extra for a company with operational costs, debt servicing, and all the other baggage when you can just buy the asset directly?
Consider the mNAV ratio—how far the stock trades above or below Bitcoin net asset value. It recovered to 1.16, but was far below the levels seen earlier in 2025. The market now values Strategy only 16% above its Bitcoin holdings, compared with premiums exceeding 50% during the year’s rally.
The ETF Effect: No More Free Bitcoin Premiums
The ETF Effect
Spot Bitcoin ETFs are game changers. For years, Strategy was the go-to for institutional investors wanting Bitcoin exposure within a regulated framework. Now, they have options. This has eroded Strategy's advantage, redirecting capital to simpler, lower-fee vehicles. ByteTree succinctly stated that Strategy was once "3x ahead of BTC; now it’s just 50%."
I've looked at hundreds of these filings, and this shift is significant. We’re not talking about a minor adjustment; we're seeing a fundamental repricing based on market access and risk assessment.
But is the market undervaluing Strategy's other assets, its operational capabilities? Probably not. The company's value is almost entirely tied to Bitcoin's price. A 10% swing in BTC can materially shift its market cap. And with the broader Fear and Greed Index sitting in "extreme fear" territory, investors are clearly risk-averse.
It’s important to remember that, according to @BitMEXResearch, Strategy’s enterprise value (EV), including both market cap and debt, remains about $76 billion, roughly 20% above the market value of its Bitcoin holdings. So, the market isn’t giving a discount on Strategy’s Bitcoin.
So, What's the Real Story?
The "shock" isn't that Strategy's market cap dipped; it's that the market finally applied some traditional finance discipline to a crypto-adjacent company. The era of guaranteed premiums for Bitcoin-holding corporations is over. Strategy will likely continue to trade as a leveraged proxy for Bitcoin, but one now priced with caution.
