Strategy Incorporated, formerly known as MicroStrategy, is under the spotlight once again as it doubles down on its bold Bitcoin-centric treasury model amid increasing market volatility.

Led by Executive Chairman Michael Saylor, the firm is the largest publicly traded corporate holder of Bitcoin (BTC), currently owning 528,185 BTC valued at approximately $41.3 billion. These holdings were accumulated at an average price of $67,458, totaling $35.63 billion in acquisition costs. The latest purchase was made on March 30, 2025, when Strategy acquired 22,048 BTC for $1.92 billion at $86,969 per coin.

Strategy’s Capital Model: High Stakes, High Exposure

Strategy has raised $8.65 billion through equity and debt since 2020 to finance its aggressive Bitcoin acquisitions. Notably, it secured $2 billion in February 2025 via zero-coupon convertible notes maturing in 2030 and another $584 million through a preferred stock (STRK) offering in late 2024.

However, the firm’s Q1 2025 SEC filings revealed an unrealized loss of $5.91 billion due to Bitcoin's drop to $77,351—partially mitigated by a $1.69 billion tax benefit. Despite this, Strategy still holds an unrealized gain of 14.62% on its overall BTC holdings.

The company’s BTC Yield—a KPI tracking Bitcoin per share—increased by 11% year-to-date, aiming for 15% annually until 2027. A 10-for-1 stock split in July 2024 also enhanced share availability and liquidity.

Software Struggles While Bitcoin Dominates

While Bitcoin continues to dominate the company’s balance sheet, Strategy's software segment revenue declined to $120.7 million in Q4 2024, down 3% YoY, and failed to generate positive operating cash flow.

Critics argue that the company’s reliance on Bitcoin overshadows its core business, with debt servicing and future fundraising tightly linked to Bitcoin’s price performance.

Liquidation Risk and the Infinite Money Loop

Strategy currently carries $8.2 billion in unsecured loans, with no collateralized debt tied to Bitcoin. According to estimates, the firm could cover its debt obligations by liquidating just 15% of its BTC holdings at present market value.

Michael Saylor, who controls 46.8% of voting shares, remains firm on his "never sell" stance and maintains that even a price crash wouldn't force a selloff.

The company’s capital model—issuing stock and convertible notes to purchase more BTC—has been dubbed the “infinite money glitch.” This self-reinforcing loop depends heavily on investor confidence and Bitcoin’s sustained growth.

Risks: Centralization, Tax, and Regulation

While the strategy has yielded gains, it comes with increasing risks. Observers highlight the centralization of decision-making, potential tax burdens on $18 billion in unrealized gains, and growing regulatory scrutiny, particularly from the SEC.

Despite the firm’s share price surging 336% in 2024, it plummeted 55% from its all-time high of $543 in November to $250 in February 2025, exposing the stock’s vulnerability to Bitcoin fluctuations.

Conclusion

Strategy Inc.’s Bitcoin-first capital strategy remains one of the most aggressive and controversial plays in the corporate crypto space. Its survival hinges on the long-term performance of Bitcoin, investor sentiment, and Michael Saylor’s unwavering vision. As the crypto market faces volatility, the question remains—can Strategy weather a prolonged Bitcoin downturn without collapsing under its own weight?

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