MicroStrategy’s substantial $64 billion investment in Bitcoin has become a focal point of stress for investors as the cryptocurrency trades below the $60,000 mark—its lowest since 2024. The company, now rebranded as Strategy, is grappling with a significant decline in its stock value, which currently sits below the worth of its Bitcoin holdings. The ongoing debate among investors isn’t centered on whether the company will face liquidation in the immediate future but rather on who will take the financial hit while Strategy retains its coins and continues to incur costs for holding them.
As of June 22, Strategy held an impressive 847,363 BTC, purchased at an average price of $75,651 each, marking it as the holder of the largest corporate Bitcoin position globally. The operational model of the company functions on a “flywheel” principle, wherein it raises capital through stock and debt to acquire more Bitcoin, leading to a rise in share prices when Bitcoin appreciates. However, as the prices tumble, the dynamics shift unfavorably for the company and its investors.
This week, Bitcoin’s price drop has mirrored a decline in Strategy’s stock, which has slipped beneath the actual value of the Bitcoin asset on its ledger. The introduction of a new accounting standard has heightened the visibility of these losses; since 2025, companies have been required to adjust the value of their Bitcoin holdings to fair market value each quarter. Consequently, Strategy recorded an unrealized loss of $14.46 billion in early 2026, translating to a net loss of $12.54 billion, equating to $38.25 per diluted share.
The burden of this investment does not solely fall on Strategy. As the company’s financial situation deteriorates, five main groups are absorbing the impact. Shareholders find themselves with diminished stakes as the stock trades below the Bitcoin’s value, which complicates the company’s capital-raising efforts. Executive Chairman Michael Saylor highlighted the dilemma during the Q1 2026 earnings call, explaining how selling new shares at a loss dilutes existing shares and ultimately costs shareholders.
Copycat companies that followed in MicroStrategy’s footsteps faced even steeper declines than the original. Many of these companies’ stocks, previously inflated by hype, now trade below the underlying Bitcoin value, leaving latecomers with significant losses. The MSCI has also proposed exclusion of companies heavily invested in digital assets from global indexes, raising concern among institutional investors about potential forced sales.
Lenders and investors assumed that Strategy could perpetually refinance its operations. However, if Bitcoin prices remain low into 2027, this assumption could prove untenable. The company has indicated that proceeds from any Bitcoin sales would likely fund dividends on preferred stock, yet this situation could lead to scrutiny and pressure if financing options dwindle.
Despite the current lack of immediate margin calls, Strategy faces a critical deadline. By September 15, 2027, holders of a $1.01 billion convertible note can demand repayment. If the stock price is below the conversion price at that time, this obligation could put the company in a precarious financial position.
While Strategy’s current debt structure is unsecured, removing automatic triggers does not eliminate repayment responsibilities. Already, some companies within the sector have been compelled to sell Bitcoin to pay off debts, which raises questions about Strategy’s ability to liquidate assets if required.
For now, the focus has shifted from whether Bitcoin will drop below $60,000 to a more pressing deadline—the repayment date in September 2027. As the tension builds, Strategy may find itself navigating an increasingly challenging financial landscape while seeking to hold onto its substantial Bitcoin holdings.
