Bitcoin News Today: Famed Short Seller Warns $51.4M Bitcoin Buy Signals Weak Demand for Strategy Shares

James Chanos, the renowned short-seller known for betting against Enron before its 2007 collapse, has raised concerns over Strategy’s $51.4 million Bitcoin purchase, interpreting the move as a sign of weak demand for the firm’s preferred stock offerings [1]. In a public statement, Chanos argued that the acquisition reflects insufficient investor interest in Strategy’s shares and criticized the company for loosening a key shareholder protection against dilution. This alleged change in policy, he said, gives CEO Michael Saylor more flexibility to issue equity at lower valuations, potentially harming existing shareholders [1].

The purchase added 430 BTC to Strategy’s holdings, bought at approximately $119,666 per Bitcoin, bringing the firm’s total Bitcoin reserve to 629,376 BTC valued at around $72 billion as of August 17, 2025 [1]. Strategy’s Q2 2025 earnings report indicated that the company had been issuing stock below 2.5x mNAV—market-to-net asset value—to fund preferred dividends and service debt. However, the latest transaction included language in investor presentations that critics interpret as giving the firm more leeway to issue equity at lower valuations by adding the phrase “when otherwise deemed advantageous” [1].

Chanos’ comments highlight a growing debate over Strategy’s corporate strategy and its impact on shareholder value. While the firm has been aggressively accumulating Bitcoin, critics argue that such moves may not align with investor interests unless there is strong demand for the company’s equity. Strategy’s stock, trading at $360.98 as of the latest market update, is down 1.46% on the day, with shares near the bottom of their daily range [1].

The firm has previously made large-scale Bitcoin purchases, including a $2.5 billion capital raise in July 2025 through the issuance of preferred shares, which was used to acquire 21,021 BTC at an average price of $117,256 [1]. This pattern of activity has been described by some analysts as a sign of the accelerating convergence between traditional finance and crypto, with companies using equity to gain exposure to digital assets.

Despite the criticisms, Strategy has not publicly responded to the concerns raised by Chanos or others. The firm’s continued Bitcoin accumulation underscores a long-term commitment to the asset, though the effectiveness of this strategy in a market where Bitcoin itself has declined by 2.8% in 24 hours remains uncertain [1].

Sources:

[1] title1: Famed Short Seller Warns Strategy's $51M Bitcoin Buy Signals Weak Demand for Latest Offering (https://decrypt.co/335607/short-seller-strategy-bitcoin-buy-weak-demand-offering)