The cryptocurrency market has seen its share of surprises this year, but the latest statements from Strategy CEO Phong Le are adding to the tension. The company, known as the largest corporate holder of bitcoin, now acknowledges that in an extreme scenario, it would be willing to liquidate its stash. That sounds drastic, but according to Le, it’s not a change in strategy—rather, a last resort.
Bitcoin Sales as a ‘Last Resort’ #
In a recent podcast, Le explained that bitcoin would only be sold if Strategy’s multiple to net asset value (mNAV)—which indicates how many times the company’s market value exceeds its bitcoin holdings—drops below one and the company loses access to new financing. In such a situation, it becomes a calculation: it would be wiser to protect the value of each share than to hold onto bitcoin at all costs. According to Le, selling bitcoin in that case isn’t a matter of wanting but of necessity—it’s, as he puts it, “mathematically justified.”
Strategy funds its growth by raising capital when its stock price trades higher than the value of the bitcoin it holds. The extra capital raised is then used to buy more bitcoin, increasing the bitcoin per share. As long as the stock maintains a premium above the net asset value (total assets minus liabilities divided by shares), this model is highly lucrative. But if that premium vanishes, Strategy faces two options: issue new shares at a lower valuation (which would heavily dilute shareholders) or sell part of its bitcoin reserves. Le emphasizes that no one at Strategy is eager to do the latter, but financial discipline takes precedence over emotion when markets turn. His words leave little room for interpretation: “I would not want to be the company that sells Bitcoin.”
Dividend Pressure and BTC Resilience #
That scenario sounds less theoretical than it seems, as Strategy faces serious cash obligations. Due to a series of new preferred shares, the company must pay between $750 million and $800 million in dividends annually. Le has a plan: fund these obligations with equity as long as mNAV allows, trusting that consistent dividend payments will bolster market confidence.
Just a few weeks ago, Strategy reaffirmed its confidence in Bitcoin by investing tens of millions of euros extra: the company purchased 8,178 bitcoin. This hefty purchase seemed to signal that Strategy would stick to its long-term vision.