MicroStrategy, led by Michael Saylor, experienced a significant stock decline at the end of 2025, despite holding the world's largest Bitcoin treasury worth around $59 billion. The company's stock fell over 50% in three months due to market pressures, risks of delisting, and dilution from Bitcoin purchases, although it increased its cash reserves to support dividends and manage Bitcoin volatility.
MicroStrategy, the largest corporate Bitcoin holder with over 671,000 BTC, faces potential collapse if Bitcoin's price drops significantly, which could trigger a major fallout in the crypto market similar to or worse than the 2022 FTX collapse, due to its heavy debt, reliance on Bitcoin's value, and aggressive funding strategies.
MicroStrategy has made a significant $980 million Bitcoin purchase, its largest since July, funded mainly through stock and preferred share sales, raising concerns about dilution and share valuation. Despite Bitcoin's decline from its peak, the company continues to position itself as a digital asset treasury leader, with its stock trading at a slight premium and ongoing debates about its inclusion in major indices.
Renowned short seller James Chanos closed his $MSTR/Bitcoin hedge after 11 months, signaling a potential end to the Bitcoin treasury bear market, amid shifting institutional sentiment and a possible market reversal, though volatility remains.
MicroStrategy's stock rose 3% amid a crypto rally, despite buying fewer bitcoins than usual—155 at an average of $116,401—valuing its holdings at over $75 billion. The rally is supported by Bitcoin's recent surge and pro-crypto policies in Washington, with MicroStrategy and Coinbase stocks up significantly over the past year.
Michael Saylor, chairman of MicroStrategy, defends the firm's substantial Bitcoin holdings, which control about 3% of the total supply, and potentially up to 7%, asserting it is not excessive and comparing it to BlackRock's holdings. The company reported its first profitable quarter with a $10 billion net income in Q2 and a $13.2 billion gain from BTC holdings year-to-date. MicroStrategy funds its Bitcoin acquisitions through stock issuance and debt, and plans to use yield-bearing preferred stocks to raise capital for further Bitcoin purchases, viewing its stock as undervalued and a way to generate Bitcoin-denominated returns.
Bitcoin's surge to an all-time high has boosted crypto-related stocks like Coinbase, Circle, and MicroStrategy, with Coinbase being the most balanced long-term investment despite high valuation, while Circle and MicroStrategy present more risk due to overvaluation and asset dependency.
Public companies have outpaced ETFs in Bitcoin purchases for the third consecutive quarter, driven by strategies to increase shareholder value and benefit from a more crypto-friendly regulatory environment, with major players like MicroStrategy leading the trend.
Publicly traded companies are increasingly buying Bitcoin as part of a 'bitcoin treasury' strategy, driven by motives like inflation hedging and industry support, with MicroStrategy owning the largest share. This trend is fueled by the rising value of Bitcoin and restrictions on direct investment, but carries risks if Bitcoin prices fall. The strategy has led to significant stock price increases for some companies, though its long-term viability is debated.
Trump Media & Technology Group plans to raise $2.5 billion to buy Bitcoin, following a strategy similar to MicroStrategy, to boost its assets and potentially its share price, amid growing corporate interest in crypto treasuries. This move aligns with Trump's political support for digital currencies and reflects a broader trend among small companies transforming into crypto holdings to leverage Bitcoin's value and the associated 'NAV multiple.' However, the strategy carries risks, as seen with the mixed performance of related stocks and the volatility of Bitcoin itself.
GameStop announced its first Bitcoin purchase, acquiring 4,710 Bitcoins valued at over $5.12 billion, signaling a shift towards becoming an investment-holding company similar to MicroStrategy, though its move is less aggressive. The company aims to add Bitcoin as a treasury reserve asset, but its shares fell 10% following the announcement, reflecting investor skepticism. The move highlights GameStop's evolving strategy amid the broader trend of corporations investing in cryptocurrencies.
Dogecoin has dropped 19% since reaching a three-year high of $0.48, despite Bitcoin's rebound after surpassing $100,000. Over the past week, Dogecoin has been the biggest loser among the top 10 cryptocurrencies, with a 15% decline, while Bitcoin is the only one in the green, up 0.7%. Other meme coins have also seen significant losses. Meanwhile, MicroStrategy has joined the Nasdaq 100, marking a significant milestone for Bitcoin enthusiasts.
MicroStrategy is set to join the Nasdaq-100 Index, marking the first bitcoin-centric company to do so, which will expose its stock to billions in passive investment flows. This inclusion will significantly increase the index's exposure to bitcoin, as MicroStrategy holds about $42 billion in BTC. The move could lead to further interest from ETFs like the SPDR S&P 500 Trust, potentially offering millions of investors indirect bitcoin exposure. However, there is a possibility that MicroStrategy might be reclassified as a financial firm due to its heavy reliance on bitcoin holdings.
MicroStrategy Inc., Palantir Technologies Inc., and Axon Enterprise Inc. are set to join the Nasdaq 100 Index, replacing Illumina Inc., Super Micro Computer Inc., and Moderna Inc. These changes will take effect before the market opens on December 23.
MicroStrategy, known for its significant bitcoin holdings, will join the Nasdaq 100 index, potentially boosting demand for its stock as ETFs like the Invesco QQQ Trust will automatically include it. This move follows a year of substantial gains for MicroStrategy's stock, which has risen over sixfold, paralleling bitcoin's 140% increase. The inclusion, effective December 23, could lead to further market interest, with future aspirations for S&P 500 inclusion. MicroStrategy's strategy involves leveraging bitcoin to bridge traditional capital markets with the crypto economy.
