Diamond Hands Put to the Test: Will Strategy Ever Capitulate?

CN
2 hours ago

Strategy, the company that pioneered the bitcoin treasury playbook, is in the public eye after the cryptocurrency market collapsed on Saturday, shedding billions in market capitalization.

After a brutal session, BTC fell under $76K in some exchanges, right below the numbers reported by Michael Saylor, Executive Chairman of Strategy, as the company’s average purchase price.

While it has floated over $78K at the time of writing, speculation about Strategy selling part of its bitcoin and the implications of such a move rose on social media channels.

While Saylor has repeatedly stated that the company would never sell bitcoin, he and other company representatives have acknowledged that this might happen if certain conditions are met.

In an November interview, Strategy CEO Phong Le recognized that the company could sell part of its bitcoin stash if it faces difficulties raising new capital through equity or debt issuance and Strategy’s value goes below the price of its BTC reserves.

Even with the recent market moves, this is far from happening, and the company has been preparing to maintain large liquidity levels, increasing its “green dot” reserves to over $2 billion last year to fulfill its obligations without selling BTC.

However, analysts are more concerned about the psychological effect of a BTC sale on the markets than the actual sale, given that it could erode trust in its status as a safe-haven asset for institutions.

Nonetheless, prediction markets believe that Strategy won’t sell BTC anytime soon, with a 5% chance of it happening before March 2026.

At the time of writing, Strategy is the corporation owning the most bitcoin on the planet, with 712,647 BTC under its control, with its latest disclosed purchase reported on January 26.

Read more: Saylor’s Green Dots Deliver Again as Strategy Boosts USD Reserve to $2.19B

  • What controversy surrounds Strategy following the recent cryptocurrency market collapse?
    Strategy is under scrutiny after bitcoin prices fell below $76K, coinciding with the average purchase price reported by Executive Chairman Michael Saylor.

  • What speculation has arisen regarding Strategy’s bitcoin holdings?
    There are rumors on social media about Strategy potentially selling part of its bitcoin stash, although Saylor has claimed the company would never do so.

  • What conditions did CEO Phong Le mention regarding a possible sale of Bitcoin?
    Le indicated that the company might consider selling bitcoin if it struggles to raise capital and if bitcoin’s value drops below its reserves’ price.

  • How much bitcoin does Strategy currently hold?
    As of now, Strategy controls 712,647 BTC, making it the largest corporate holder of bitcoin, with recent purchases disclosed on January 26.

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