I have read the replies from my friends, and most of them believe that MSTR's biggest mistake is adding leverage when buying Bitcoin: native. Let's talk about my opinion. Firstly, MSTR admitted in its annual report that its strategy is to use equity and debt capital market financing to buy Bitcoin and maintain leverage exposure to Bitcoin. The company also disclosed that Bitcoin does not generate interest and dividends, and its financial obligations mainly rely on common stock ATMs, US dollar reserves, additional equity or debt financing to cover. If we only look at the surface, it is indeed using leverage to buy BTC. But the real problem is not the word 'leverage', the problem lies in the nature of leverage. There are many types of leverage. Low interest convertible bonds are a form of leverage, common stock ATMs are a means of financing amplification, and preferred stocks are another source of funding close to fixed income products. Putting these things together carries completely different risks. In the early days, MSTR used low interest convertible bonds to buy BTC, and the risk was relatively controllable because the interest pressure was low and the term was relatively long. As long as there was no short-term forced liquidation, BTC fluctuations could be hedged over time. When MSTR's stock price has a long-term premium relative to BTC, using common stock financing to buy BTC is essentially converting the premium given to MSTR by the capital market into more BTC. Whether this action is beneficial to ordinary shareholders depends on whether the BTC per share will increase or decrease after the issuance. What really worries me is that the structure behind it is starting to become heavier. That is to say, the establishment of preferred stocks. Preferred stocks are different from convertible bonds, and preferred stocks are not that simple. Preferred stocks do not bring immediate debt pressure, but will bring sustained dividend pressure, and have priority over common stocks. BTC itself does not generate cash flow, and MSTR needs to pay these dividends either by relying on US dollar reserves, continuing financing, selling common stocks, or in extreme cases, selling BTC. So the problem is not that MSTR bought BTC with leverage, the problem is that MSTR's later financing structure became increasingly dependent on the capital market being willing to give it money. As long as BTC rises, MSTR has a premium, ATMs can be issued, and preferred stocks can be sold, this system is a positive cycle. MSTR can raise funds, and after financing, buying BTC will increase BTC reserves, resulting in an increase in BTC per share, and the market will continue to give MSTR a premium. But if BTC falls, MSTR stock prices fall, premiums shrink, preferred stock prices fall, and financing costs rise, the system will reverse. The more worried the market is, the harder it is to raise funds. The more difficult it is to raise funds, the more worried the market is about how to pay dividends and replenish US dollar reserves. The more worried the market is, the greater the pressure on MSTR's common and preferred stocks. This is the real risk of MSTR. MSTR is more like bundling BTC's long-term rise, company stock premium, capital market financing capability, and preferred stock credit into a structure. When the wind is favorable, this is an accelerator. When facing headwinds, this is a stress test. Especially with the significant cyclical fluctuations of Bitcoin itself, it means that MSTR is likely to experience high and negative premiums periodically. Moreover, from the current perspective, the issue of MSTR's cycle extending until 2028 is not significant, but the difficulty lies in another cycle after 2028. Bitget is here, VIP! Crypto、 US shares CFD， Global Advantage One Stop Layout