Strategy would consider liquidating Bitcoin holdings only under extreme financial duress - specifically if the company's stock falls below net asset value and all capital-raising options disappear - CEO Phong Le disclosed in a recent interview.
Le told the What Bitcoin Did podcast that if Strategy's multiple to net asset value slips under 1x and financing options evaporate, selling Bitcoin becomes "mathematically" justified to protect what the company calls "Bitcoin yield per share." The world's largest corporate Bitcoin holder currently possesses 649,870 BTC valued at approximately $59 billion, acquired at an average cost of $74,433 per coin.
However, Le emphasized the move would represent a last resort rather than a policy shift. "I would not want to be the company that sells Bitcoin," he stated, adding that financial discipline must override emotion when markets turn hostile. The framework marks the first time Strategy leadership has publicly articulated specific conditions under which the firm might reduce its Bitcoin position.
Strategy's business model hinges on raising capital when shares trade at a premium to NAV and deploying those proceeds to acquire additional Bitcoin, thereby increasing holdings per share. When that premium disappears, Le explained, selling a portion of holdings to meet financial obligations can prove less dilutive to shareholders than issuing new equity at unfavorable prices.
What Happened
The disclosure comes as investors scrutinize Strategy's expanding fixed-payment obligations tied to preferred shares introduced throughout 2024. Le estimated annual dividend commitments near $750 million to $800 million as recent offerings mature. His strategy involves funding those payouts primarily through equity raised at premiums to mNAV.
"The more we pay the dividends out of all of our instruments every quarter, that's seasoning the market to realize that even in a bare market, we're going to pay these dividends. When we do that, they start to price up," Le explained during the interview.
Strategy launched a new "BTC Credit" dashboard last week to reassure investors following Bitcoin's recent decline and subsequent selloff in digital asset treasury stocks. The company claims sufficient dividend coverage for decades even if Bitcoin prices remain flat, with debt remaining well-covered if BTC falls to the firm's $74,000 average purchase price and manageable even at $25,000.
The dashboard introduces a "BTC Rating" metric measuring the ratio of Bitcoin assets to convertible debt. According to Strategy's calculations, if Bitcoin drops to the company's average cost basis, assets would still exceed convertible debt by 5.9 times. Even at $25,000 per Bitcoin - approximately 67 percent below current prices - the coverage ratio would maintain 2.0 times, the firm stated.
Le defended Bitcoin's long-term value proposition beyond balance-sheet mechanics, characterizing the asset as scarce and non-sovereign with global appeal. "It's non-sovereign, has a limited supply… people in Australia, the U.S., Ukraine, Turkey, Argentina, Vietnam and South Korea — everyone likes Bitcoin," he added.
Strategy's mNAV stood at 1.16 at the time of the dashboard's release, indicating the company retains theoretical capacity to issue new shares for additional capital raises. The metric has compressed significantly from a November 2024 peak of 3.2x, when investors paid nearly four times the underlying Bitcoin value per share.
Why It Matters
Strategy's operational framework represents the most prominent example of corporate Bitcoin treasury management, with the company's approach influencing a broader category of digital asset treasury firms. The CEO's public acknowledgment of potential selling conditions provides critical transparency about the model's limits during market stress.
The firm has raised more than $40 billion since early 2024 through a combination of $27 billion in common equity sales and $13.8 billion in fixed-income securities, transforming Strategy into Wall Street's primary Bitcoin proxy. This aggressive accumulation strategy has positioned the company as holder of approximately 3.1 percent of Bitcoin's total supply.
However, the model's sustainability depends on maintaining share prices at premiums to underlying Bitcoin value. When mNAV falls below 1.0, treasury companies lose the ability to issue equity at favorable prices for continued Bitcoin purchases, potentially triggering what analysts describe as death spirals where firms cannot raise capital to service debt or fund operations.
Strategy currently faces intensifying scrutiny as its stock has declined approximately 36 percent in November alone, marking the worst monthly performance since April 2024. The company's market capitalization has fallen to $49.5 billion while its Bitcoin holdings are valued at more than $56 billion, creating a discount to net asset value for the first time in recent history.
JPMorgan analysts warned last week that Strategy faces risks if MSCI excludes digital asset treasury companies from its indexes during upcoming reviews. Such exclusion could reduce institutional ownership and further compress the mNAV premium that enables the company's capital-raising model.
Despite market turbulence, Strategy's leadership maintains that enterprise software cash flows and diversified funding sources significantly reduce liquidation risks. Lacie Zhang, research analyst at Bitget Wallet, noted the company's "diversified funding and hodl strategy positions them well for sustained growth."
Ki Young Ju, founder and CEO of CryptoQuant, suggested Strategy's financial strength could establish a Bitcoin price floor during future downturns. "Players like MSTR are unlikely to sell and those coins are effectively off the market," potentially preventing Bitcoin from revisiting its realized price around $56,000 during the next bear market, he stated.
The company's ability to service debt obligations without forced Bitcoin sales would mark a significant evolution from previous cryptocurrency market cycles, when leveraged entities frequently faced liquidation cascades that amplified price declines. Strategy's commitment to holding Bitcoin through market volatility - contingent on maintaining access to capital markets - could reduce systematic selling pressure during future downturns.
Le's framework establishes clear parameters: Strategy remains a Bitcoin accumulation vehicle as long as market conditions permit capital raises at reasonable valuations. Only when both the stock premium disappears and capital markets close would the company consider reducing its position, prioritizing shareholder value over ideological commitment to perpetual holding.