Key Takeaways
- •Strategy is the largest corporate Bitcoin holder, with approximately 650,000 BTC on its balance sheet.
- •The company's operational model relies on raising capital and converting it into BTC while maintaining its market-cap-to-Bitcoin value (mNAV) above 1.
- •CEO Phong Le has characterized any Bitcoin sale as a "last resort" option, to be considered only if mNAV drops below 1 and access to new capital significantly deteriorates.
- •Even if Strategy were to sell a portion of its holdings, Bitcoin trades in a market with tens of billions in daily volume, suggesting any sale would likely be targeted rather than a complete exit.
Strategy, formerly known as MicroStrategy, has dedicated the past five years to becoming what it describes as "the world's first and largest Bitcoin Treasury Company." As of early December 2025, the company held nearly 650,000 Bitcoin (BTC), representing over 3% of the total 21 million supply and making it by far the largest Bitcoin holder among public companies.
For many traditional investors, Strategy's stock became a leveraged proxy for Bitcoin. Rather than purchasing BTC directly, these investors opted for the stock, as the company raises capital and subsequently converts it into Bitcoin.
The current discussion stems from CEO Phong Le's recent remarks indicating the possibility of a Bitcoin sale under very specific circumstances. While headlines often emphasize the word "sell," the company frames this as a risk management strategy for extreme stress scenarios, not as a departure from its long-term Bitcoin thesis.
This article aims to explain how Strategy's plan operates and what conditions might trigger sales, providing readers with context to interpret future news without succumbing to panic or fear of missing out (FOMO). This information is for educational purposes only and does not constitute investment advice.
Recent estimates suggest that institutions now hold nearly 20% of all mined Bitcoin.
How Strategy’s Bitcoin Engine Works
On a day-to-day basis, Strategy operates a financially straightforward loop. The company:
- Raises capital in traditional markets through common-stock at-the-market programs, multiple series of perpetual preferred stock (such as STRK and STRF), and occasional convertible debt.
- Utilizes a significant portion of this capital to acquire more Bitcoin, which it designates as its primary treasury reserve asset.
- Monitors a set of key metrics to determine the sustainability and accretive nature of this strategy for shareholders.
Two critical metrics are:
- •Bitcoin per Share (BPS): This metric represents the amount of BTC effectively allocated to each fully diluted share and is published by Strategy as a key performance indicator.
- •Market-Cap-to-Net-Asset-Value (mNAV): This ratio compares Strategy's total market value to the market value of its Bitcoin holdings. An mNAV above 1 indicates that the stock is trading at a premium to its Bitcoin assets.
When the company trades at a healthy premium, it can raise new equity or preferred stock with minimal dilution, thereby expanding its Bitcoin holdings. Management maintains that this base case scenario—where Strategy raises capital at a premium, acquires more BTC, and increases BPS—remains its ongoing objective.
The "Last Resort" Sale Trigger
A new element introduced is a clearly defined "kill switch" for the company's operational model.
In recent interviews, CEO Phong Le explained that Strategy would only consider selling some Bitcoin if two conditions were met simultaneously:
- mNAV falls below 1, signifying that the company's market capitalization has dropped to or below the market value of its Bitcoin holdings.
- Access to fresh capital becomes severely restricted, such as if investors are no longer willing to purchase its equity or preferred stock on viable terms.
Le described selling BTC in such a scenario as a "last resort" toolkit option, intended to meet obligations like preferred dividends, rather than a standing plan to liquidate its Bitcoin treasury.
In simpler terms: If the stock trades at or below the value of its Bitcoin holdings and the company is unable to refinance itself, selling a portion of its BTC becomes the least unfavorable option to protect the overall corporate structure.
Factors That Could Realistically Push Strategy Toward the "Last Resort" Threshold
Several interconnected factors would need to align before the "last resort" mechanism would even be considered.
Macroeconomic Conditions and Bitcoin Price
Bitcoin has experienced a significant pullback from its October all-time high of nearly $126,000, falling to the mid-$80,000s, a decline of approximately 30%. Deeper or more prolonged downturns not only reduce the value of Strategy's Bitcoin holdings but also tend to exert downward pressure on its stock price concurrently.
Equity Performance and mNAV
Strategy's market cap premium relative to its Bitcoin holdings has already narrowed, following a 30%-60% slide in the stock price from earlier peaks. In mid-November, the company briefly traded at or near the spot value of its holdings, indicating an mNAV close to 1.
Funding Conditions
The company's business model is contingent on its ability to issue new common and perpetual preferred shares through existing shelf registrations and at-the-market (ATM) programs. A sharp slowdown in these offerings or significantly higher yield demands from investors would signal stress on the company's funding capabilities.
Internal Obligations
Strategy faces substantial annual financial commitments, including preferred dividends and debt service. Analysts estimate preferred dividend obligations to be in the hundreds of millions of dollars annually.
Management continues to articulate its position as a long-term Bitcoin accumulator, and the scenarios outlined above depict a severe stress environment.
Onchain forensics suggest that 3 million-4 million BTC is likely lost forever in dead wallets, meaning a significant portion of the supply will never re-enter the market.
Implications of a Strategy Sale for Bitcoin
Given that Strategy holds 650,000 BTC, any shift from a "never sell" stance to a "might sell under stress" position naturally garners attention from traders.
However, context is crucial:
- •Market Size: Daily spot and derivatives volume in Bitcoin regularly reaches tens of billions of dollars. Concurrently, U.S. spot Bitcoin exchange-traded funds (ETFs) have experienced single-day inflows and outflows measured in billions. A controlled sale of a fraction of Strategy's holdings, even if substantial, would enter a very large and liquid market.
- •Likely Scale and Pace: Based on Le's own statements, any sale under stress conditions would be targeted and partial, aimed at meeting obligations or preserving the capital structure rather than exiting Bitcoin entirely.
- •Advance Pricing: Markets often begin to incorporate potential future events as soon as they are disclosed. The recent pullback in both BTC and Strategy's stock, along with discussions surrounding mNAV, exemplifies this market process.
It is important to recognize that a conditional framework for last-resort sales is distinct from an announcement indicating that large-scale BTC sales are imminent.
In Q3 2025, average daily crypto spot trading volume was approximately $155 billion, with an additional $14 billion in notional crypto derivatives trading daily on CME alone.
How to Monitor Strategy's Future Movements
For readers seeking to follow this narrative without overreacting to every headline or meme, several observable indicators can provide clearer insight into the situation:
Prioritize Primary Sources
- •U.S. Securities and Exchange Commission filings, such as 8-Ks and prospectus supplements, provide details on new capital raises and updated Bitcoin holdings.
- •Strategy's press releases and its "Bitcoin Purchases" page offer summaries of recent acquisitions and total holdings.
Track Core Metrics
- •U.S. Securities and Exchange Commission filings, such as 8-Ks and prospectus supplements, provide details on new capital raises and updated Bitcoin holdings.
- •Strategy's press releases and its "Bitcoin Purchases" page offer summaries of recent acquisitions and total holdings.
- •Social media activity often reflects sentiment rather than concrete data. Posts with "green dots," laser-eye memes, and doomsday threads can offer insights into market mood. However, it is advisable to cross-reference any claims about forced selling or insolvency with official filings and financial data.