Bitcoin News Today: MicroStrategy's Bitcoin Dilemma: Hold for Growth or Sell to Survive?

Bitcoin's recent slide below $88,000 has pushed MicroStrategy's stock to a 52-week low, testing the resilience of the company's controversial Bitcoin treasury strategy. MSTR shares fell to $173.55 this week, mirroring BTC's decline and raising fresh concerns about the viability of its funding model. The stock, which has lost 40% in 2025 and over 62% in the past year, now trades near levels last seen during the dotcom crash, with analysts warning that the company's financial instruments are under increasing pressure according to blockonomi.com.

MicroStrategy's Bitcoin holdings, which now number 650,000 coins, have become a double-edged sword. While CEO Michael Saylor has framed the company as a "structured finance enterprise" leveraging Bitcoin as productive capital, the current price of BTC-trading below MicroStrategy's average acquisition cost of $74,000-has left its treasury "mostly underwater." This has constrained the company's ability to raise capital through equity sales, as its fully diluted market cap now sits at just 0.98 times its Bitcoin net asset value according to blockonomi.com.

The strain is evident in MicroStrategy's preferred shares, which once traded near $100 but have since fallen sharply. STRD now trades at $66, STRK at $75, and STRF at $95.08, reflecting a market demanding higher yields amid growing risk. These instruments, designed to fund further Bitcoin purchases, have instead become a drag on liquidity. JPMorgan analysts noted that the company's leveraged exposure has amplified its losses, with MSTR shares falling more than BTC itself.

Saylor has sought to reassure investors, claiming the company can withstand a BTC drop of up to 80%. "We are positioned to hold through a BTC drop of up to 80%," he stated. However, critics argue that selling Bitcoin to meet financial obligations could create a self-fulfilling prophecy, further depressing prices and eroding the company's value.

Compounding the challenges, JPMorgan warned that MicroStrategy faces potential exclusion from major indices like MSCI, which could trigger up to $8.8 billion in outflows. The firm noted that $9 billion of MicroStrategy's market cap is currently held in passive investments tied to benchmarks. Exclusion would not only reduce liquidity but also raise questions about the company's ability to raise future capital.

The 18-month test mentioned in the title now looms large. MicroStrategy's strategy relies on long-term BTC accumulation, but current market conditions-marked by weak crypto liquidity and regulatory uncertainty-threaten to undermine this approach. With Bitcoin trading near critical support levels and MicroStrategy's funding model under strain, the coming months will be pivotal in determining whether the company can weather the storm or face a reckoning.