Bitcoin News Today: Bitcoin's Slide Presses on MSTR as Financing Costs Rise

Strategy Inc (NASDAQ:MSTR) has added to its Bitcoin holdings, purchasing 1,229 bitcoin for $108.8 million in late December 2025. The company reported the acquisition in a recent SEC Form 8-K filing. The average purchase price per bitcoin was approximately $88,568, factoring in fees and expenses according to the SEC filing.

The purchase was funded through the sale of 663,450 shares of its Class A common stock under an at-the-market (ATM) program. This transaction brought the company's total Bitcoin holdings to 672,497 coins, with a cumulative purchase price of around $5.044 billion. The average cost per coin for the total portfolio now stands at $74,997 according to the SEC filing.

Strategy's continued Bitcoin accumulation highlights its aggressive digital asset strategy. The company's treasury has become the largest corporate Bitcoin holding in the public market, representing a significant portion of its balance sheet. The company has consistently used stock and debt financing to fund its Bitcoin purchases, even amid a challenging equity market according to the SEC filing.

Why the Standoff Happened

The recent Bitcoin purchase was part of Strategy's broader capital strategy, which has relied heavily on convertible debt, preferred stock, and ATM equity offerings. This approach allows the company to accumulate Bitcoin without selling existing holdings. However, the strategy comes with challenges. New financing carries higher interest and dividend costs compared to earlier, cheaper debt. Additionally, frequent share issuances dilute existing investors, reducing the value of each share in terms of Bitcoin exposure.

The market has responded to these dynamics with caution. MSTR shares have fallen over 60% from their 2025 highs and currently trade near $160, below their 200-week moving average. The stock's weak performance reflects investor concerns over rising financing costs, dilution, and Bitcoin's volatile price action according to market analysis.

Bitcoin itself has struggled to sustain higher levels amid end-of-year selling pressure. Prices have slipped toward $87,000, limiting the potential for a near-term rebound in leveraged positions like MSTR. Analysts suggest that a strong Bitcoin rally is the most likely catalyst for renewed interest in Strategy's stock.

How Markets Reacted

The recent equity offering by Strategy, which raised $108.8 million, was used to fund the latest Bitcoin acquisition. However, the stock sold off in premarket trading, dropping 1% as Bitcoin prices continued to decline. This reaction underscores the sensitivity of MSTR shares to both equity and crypto market conditions according to market analysis.

Investor sentiment is also affected by broader macroeconomic factors. The U.S. Federal Reserve's potential monetary policy shifts and Treasury purchasing trends could influence Bitcoin's direction in early 2026. Market participants are closely watching for signs of institutional demand and ETF inflows that could signal a turnaround.

In addition, regulatory pressures are intensifying for companies with large Bitcoin holdings. Potential index exclusions by MSCI for firms with more than 50% of assets in cryptocurrencies could force passive funds and ETFs to sell MSTR shares, increasing downward pressure on the stock. This would trigger billions in outflows and reduce liquidity for the company.

What Analysts Are Watching

Analysts are monitoring whether Strategy can maintain its Bitcoin accumulation strategy in a higher-cost financing environment. The company recently announced a $2.2 billion U.S. dollar reserve to cover preferred stock dividends and liquidity needs. This move signals a shift toward a more conservative treasury model, which could help manage risks during prolonged Bitcoin drawdowns according to market analysis.

The net asset value (NAV) premium metric is another key indicator. Strategy's current NAV premium is at 0.82x, meaning the market values the stock at just 82% of the net value of its Bitcoin holdings. This weak premium reflects a lack of investor enthusiasm for its leveraged exposure and highlights the challenges of raising capital at favorable terms according to market analysis.

Looking ahead, Strategy's ability to navigate higher financing costs and manage dilution will be critical. If Bitcoin rallies in 2026, the company could see renewed demand for its shares as its leveraged exposure becomes more attractive. However, without a significant upward move in Bitcoin, the stock may remain under pressure according to market analysis.