In a recent discussion on the podcast “What Bitcoin Did,” Phong Le, the CEO of Strategy, outlined the company’s enhanced flexibility and robust capital framework that allows for ongoing accumulation of bitcoin. Le explained that Strategy, formerly known as MicroStrategy, has adopted a capital structure characterized by long-dated debt and flexible equity access, effectively eliminating any immediate refinancing pressures.
Le emphasized the company’s strategic focus on capital markets, describing their access to both debt and equity as the “magic” behind their ability to consistently increase their bitcoin holdings, particularly through various market fluctuations. He noted that the firm’s balance sheet was deliberately crafted to minimize liquidity stress, ensuring enough room for opportunistic capital movements and investments.
“Our capital stack is very strong,” Le stated, pointing to the fact that the first debt obligations are not due until December 2025, which allows the company to be opportunistic in its approach. The firm manages several long-dated convertible note tranches that provide minimal near-term dilution risk, enabling them to confidently navigate funding opportunities.
Le expressed confidence in the company’s transformative journey, stating that they have achieved unprecedented flexibility at this point in their history. They are capable of capitalizing on market conditions by accessing equity through at-the-market programs or leveraging zero-coupon and low-coupon convertibles when the market favors long-term issuance. This versatility lets the firm raise capital strategically, whether in robust equity markets or during less favorable conditions.
With a current holding of over 158,000 BTC, Strategy has significantly shifted its market identity from a conventional software company to a hybrid entity that uniquely combines enterprise analytics with a bitcoin-centric treasury strategy. Le explained that their shareholder base has come to recognize this transformation, viewing Strategy as the only public market entry point for such a strategy.
Despite the company’s strong position, some investors remain skeptical about how to assess Strategy’s valuation, particularly during periods of bitcoin price volatility. Le acknowledged these concerns but maintained that the company has demonstrated resilience and effectiveness across multiple market cycles. He pointed out that their sustained access to capital at favorable terms is a validation of their model and approach.
Looking ahead, Le confirmed that Strategy plans to use excess cash flow from its software operations to further invest in bitcoin, while continually assessing market conditions to determine the best issuance strategy between equity or debt at any moment. “As long as we’re executing — in software, bitcoin, and capital markets — we believe our story will remain compelling,” he remarked.
Currently, Strategy’s Class A shares (MSTR) are trading at $17.18, reflecting a 0.88% increase for the day but showing a 41% decrease year-to-date. In comparison, bitcoin itself has experienced a 3.14% decline over the same timeframe. Analysts like James Van Straten from CoinDesk suggest that the market might still test Strategy’s enterprise valuation. He noted that the stock could dip below the company’s bitcoin cost basis, although he believes the bottom is nearing. Van Straten expects a strong rebound once investors observe the company manage its current convertible note situation effectively, asserting that both bitcoin and Strategy’s stock will rally significantly thereafter.
