Strategy (MSTR), the world's largest corporate holder of bitcoin, would not panic unless BTC sinks to the $8,000-$10,000 range, CEO Phong Le said in a Bloomberg TV interview. Le described that level as the point where the company 'would have to consider some of the risk associated with our debt.' Until then, he said, 'we feel very secure about the balance sheet.'
Balance sheet resilience and capital structure
Le explained that Strategy's goal is to build a capital structure that can weather bear markets while benefiting from bull cycles. A drop to $8,000-$10,000 would represent an approximately 85% decline from bitcoin's current price of around $64,500. The company's preferred stock, STRC, has been under pressure, falling below its $100 par value in April and dropping under $75 in late June. When STRC trades below par, Strategy's ability to issue new shares and use the proceeds to buy bitcoin is restricted.
Building dollar reserves
Le highlighted increasing the U.S.-dollar reserve as a key lever for STRC's recovery back toward $90. 'We've learned over the last couple of months that having that liquid access to U.S.-dollar capital is quite important,' he said. STRC is designed to maintain a $100 par and currently offers a 13% annual dividend yield, providing cash flow for bitcoin purchases.
MSTR stock performance and NAV premium
MSTR closed nearly 6% higher at $97.58 on Tuesday, but remains down about 36% year-to-date and 78% lower than 12 months ago. The key metric for many observers is MSTR's multiple to net asset value (mNAV), which compares the company's market cap to the value of its bitcoin holdings. That metric fell below 1 at the end of June and now stands at 1.02, meaning the shares trade at only a slight premium to the underlying bitcoin. Le noted that as long as MSTR is priced above net asset value, shareholders are giving credit for performance above bitcoin.