Strategy CEO Phong Le said the company would only begin addressing significant balance-sheet concerns if bitcoin falls into the $8,000–$10,000 range, while stating that the firm remains financially stable at current levels.
Strategy (MSTR), the largest publicly traded bitcoin holder, is confident in its financial position unless BTC experiences an extreme collapse toward those levels, Le said during a Bloomberg TV interview on Tuesday.
According to Le, such a decline would mark the point where the company would need to reassess risks linked to its debt structure. A bitcoin price of $8,000–$10,000 would represent an approximately 85% decline from BTC’s current price near $64,500.
“Until that point, we feel very secure about the balance sheet,” Le said, adding that Strategy’s priority is building a capital structure that can withstand prolonged downturns while allowing the company to benefit during bullish cycles.
Strategy’s preferred stock STRC, which was introduced to generate cash flow for bitcoin purchases while paying investors a regular dividend currently around 13% annually, has faced selling pressure in recent months. The shares were designed to maintain a $100 value but fell below that level in April before dropping beneath $75 in late June.
When STRC trades below $100, Strategy’s ability to raise capital through additional share issuance and use those funds for bitcoin acquisitions becomes more constrained.
Le highlighted rebuilding the company’s U.S. dollar reserves as a major factor in helping STRC recover toward the $90 range. He said recent market conditions demonstrated the importance of maintaining access to readily available dollar liquidity and that Strategy intends to continue strengthening its reserves.
MSTR shares ended Tuesday’s session nearly 6% higher at $97.58, though the stock remains down approximately 36% year-to-date and 78% below its level from a year earlier.
Investors are closely watching Strategy’s market capitalization-to-net-asset-value (mNAV) ratio, which compares the company’s market value with the value of its bitcoin holdings. The metric fell below 1 in late June and has since recovered to around 1.02, meaning the stock currently trades at only a slight premium to the value of its BTC reserves.
Le said that as long as MSTR trades above the net asset value of its bitcoin holdings, investors are continuing to recognize additional value from Strategy’s business model beyond bitcoin’s market performance.
