MicroStrategy, recently rebranded as Strategy (ticker: MSTR), has issued a cautionary statement in a regulatory filing suggesting it may need to part with some of its vast Bitcoin holdings if prices fall sharply. This move would mark a notable shift from the company’s steadfast “HODL” strategy and reflects potential financial vulnerability due to its leveraged position in crypto.
Massive Bitcoin Holdings at Risk
Currently the largest corporate owner of Bitcoin, Strategy owns approximately 528,185 BTC. Within this total, around 15%—or 80,715 BTC—was acquired during Q1 of 2025, at an average purchase price of $67,458 per coin. Despite Bitcoin trading at about $82,556 mid-Friday, this represents a 12% decline since the start of the year.
Financial Pressure Mounts
In its SEC filing dated April 7, the company warned that a “substantial drop” in Bitcoin’s value could jeopardize its ability to meet financial responsibilities. These include:
- Servicing $8.21 billion in outstanding loans
- Paying for office leases
- Fulfilling dividend obligations
Loan principal repayments are set to begin in 2026, intensifying the financial scrutiny on the firm’s crypto-centric balance sheet.
Unrealized Losses and Market Volatility
Strategy disclosed $5.91 billion in unrealized losses on its Bitcoin portfolio for Q1, highlighting the risks accompanying its speculative asset strategy. The price of Bitcoin has dipped below $80,000 multiple times since March, partially due to turbulence in equity markets linked to U.S. trade policy announcements.
Strategic Reassessment Ahead?
The idea that Strategy could break from its long-defended HODL philosophy underscores the risks of high leverage in volatile markets. With Michael Saylor at the helm during its transformation, Strategy’s Bitcoin-first financial composition may soon face its most significant stress test.
Read the full article at Quartz.
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