Strategy is attempting to reposition its vast Bitcoin (BTC) holdings from an accumulation asset into collateral supporting a growing credit business, according to Standard Chartered’s Geoffrey Kendrick, who argues that investor confusion around the shift has intensified pressure on both Bitcoin and MSTR shares.
In a July 10 research note shared with Yellow.com, Kendrick said Strategy’s recent actions have “muddied the waters” for Bitcoin in the near term as the company moves away from the simple “never sell” narrative that defined its strategy between 2020 and mid-2025.
“I see what is happening at MSTR right now as a communication challenge, nothing more,” Kendrick said in an accompanying email.
For years, Strategy functioned primarily as a leveraged Bitcoin accumulation vehicle. The company issued debt and sold shares when its market net asset value, or mNAV, traded well above 1.0, allowing it to raise capital and acquire more Bitcoin without immediately diluting the value of its holdings.
That model has become harder to sustain with MSTR’s mNAV now close to 1.0. Kendrick believes Michael Saylor is therefore giving the company’s Bitcoin a second purpose: backing preferred-stock products such as STRC.
Bitcoin Becomes Collateral
Kendrick described STRC as a credit product supported by Strategy’s Bitcoin balance sheet. The shift means investors must believe the company is willing and able to sell Bitcoin if necessary to protect the preferred stock.
“To convince investors the Bitcoin is collateral, Saylor needs to convince us he can sell Bitcoin if needed,” Kendrick said.
The difficulty is that Strategy spent years cultivating the idea that it would not sell its Bitcoin. Any sale is therefore interpreted by parts of the market as evidence that the accumulation strategy is breaking down, rather than as a signal supporting the new credit structure.
Kendrick argues that this is the wrong interpretation.
Once investors accept that Bitcoin can be sold to support STRC, the credibility of that backstop may reduce the likelihood that Strategy actually needs to sell.
He compared the mechanism to central banks promising to do “whatever it takes” during periods of market stress. If the market believes the commitment, the institution may not need to deploy the full intervention.
“Once investors understand this is the new purpose of the Bitcoin, MSTR won’t need to sell anymore because the communication switch will have gained credibility,” Kendrick said.
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STRC Could Return Toward Par
Standard Chartered estimates that STRC has roughly $10 billion in notional value outstanding. With Strategy’s Bitcoin holdings backing the product, Kendrick said it is heavily overcollateralized.
If investors become more confident in that structure, STRC could recover toward its $100 reference value from around $90, according to the report.
That recovery would matter for Bitcoin because stronger confidence in STRC would reduce the perceived need for Strategy to liquidate assets.
Kendrick said clearer market signalling from Strategy should therefore ease fears of large-scale Bitcoin sales and remove a source of near-term pressure from the market.
“The communication switch is tricky and has caused pain for Bitcoin prices,” he said. “Once we all understand what Saylor is trying to do, the pain will go away.”
Standard Chartered Maintains $100,000 Bitcoin Target
Despite the recent uncertainty, Standard Chartered maintained its end-2026 Bitcoin forecast of $100,000.
Kendrick described Bitcoin at $64,000 as a “screaming buy,” arguing that Strategy’s actions represent short-term noise rather than a change in Bitcoin’s medium-term outlook.
He also said MSTR appeared attractive near $94 because its mNAV was around 1.0, meaning the stock was trading close to the value of its underlying Bitcoin holdings rather than at the large premium seen during earlier accumulation phases.
The broader implication is that Strategy may no longer be best understood solely as a corporate Bitcoin treasury.
If Saylor succeeds in using the company’s holdings to support preferred shares and other yield-bearing instruments, Strategy could evolve into a Bitcoin-backed credit platform.
The risk is that investors continue to interpret every Bitcoin sale through the company’s previous accumulation-only narrative. The opportunity, in Kendrick’s view, is that once the collateral strategy is understood, selling pressure may ease precisely because the market knows Strategy is prepared to act.
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