The cryptocurrency world is holding its breath watching every move of Strategy – the entity that holds the largest Bitcoin on the US stock exchange. As the price of Bitcoin drops to around 76,000 USD, close to the company's average cost price, a wave of skepticism about whether Michael Saylor might have to "let go" is spreading across the market.
Pressure from the mNAV index and the ability to raise capital
To understand why Strategy is attracting attention, you need to know about the mNAV (Multiple to Net Asset Value) index. This is a measure compared to the value of Bitcoin that the company holds. The thing is, when mNAV is above 1, they can easily issue more shares to buy more BTC. However, this number is currently only 1.08.
If Bitcoin continues to decline and pushes mNAV below 1, Saylor's "Bitcoin buying machine" will have to pause operations. The market currently predicts a 90% chance that this index will drop further, signaling a "freeze" phase in this giant's asset accumulation. #Colecolen
Expert analysis: Is there a sell-off?
Even though the crowd's sentiment is quite pessimistic, experts from Coin Bureau and Nansen have a calmer perspective. That's the situation, Michael Saylor always insists that his strategy is to never sell. With 713.502 BTC in hand, their asset value still exceeds 52 billion USD.
The key point lies in the cash reserve of 2.25 billion USD. This amount is enough for Strategy to pay dividends on preferred shares for the next 30 months without having to touch a single Bitcoin. Moreover, the convertible bond debts are not due for payment until early next year. That's the situation, financially speaking, Strategy is still in a safe zone, despite MSTR shares having lost 75% of their value. $BTC
