by Coinstrooper Crypto Articles
Quick Take
  • MicroStrategy’s $64 billion Bitcoin (BTC) bet has become a stress test for everyone who funded it.
  • BTC now trades below $60,000, and the renamed company, Strategy, sits at a discount to its own holdings.
  • The question dividing investors is no longer whether Strategy gets liquidated tomorrow.
  • It is who absorbs the losses while the company keeps its coins and keeps paying to hold them.

What Happened

The question dividing investors is no longer whether Strategy gets liquidated tomorrow. It is who absorbs the losses while the company keeps its coins and keeps paying to hold them.

They stand first in line. When the stock trades below the value of its Bitcoin, the company still raises cash by selling new shares. Each sale buys less Bitcoin than it hands away.

Investors in other treasury companies

Passive and index fund investors

“Feedback from the consultation confirmed institutional investor concern that some DATCOs exhibit characteristics similar to investment funds, which are not eligible for inclusion in the MSCI Indexes,” MSCI said in its official announcement earlier this year.

These investors lent on the assumption that MicroStrategy could always refinance. If Bitcoin stays depressed into 2027, that assumption breaks.

Market Context

The model runs like a flywheel. The company sells stock and debt, buys more Bitcoin, and its shares climb when BTC rises. However, falling prices spin the machine in reverse.

Strategy clears that bar with ease. An exclusion would force index funds and pension trusts to sell automatically, whatever the price, just to keep tracking the benchmark.

Why It Matters

MicroStrategy’s $64 billion Bitcoin (BTC) bet has become a stress test for everyone who funded it. BTC now trades below $60,000, and the renamed company, Strategy, sits at a discount to its own holdings.

How the Bitcoin Flywheel was Built

Details

By June 22, Strategy held 847,363 BTC bought for $64.1 billion, an average of $75,651 each. That is the largest corporate Bitcoin position anywhere.

BTC has fallen below $60,000 this week, its lowest level since 2024. The stock has slid with it, dropping under the value of the Bitcoin on its books.

A new accounting standard made the pain visible. Since 2025, FASB rule ASU 2023-08 forces firms to mark Bitcoin to fair value each quarter. As a result, Strategy booked a $14.46 billion unrealized loss in early 2026. That produced a $12.54 billion net loss, or $38.25 for every diluted share.

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Who Actually Pays for MicroStrategy’s Bitcoin Bet

The bill does not fall on Strategy alone. As the flywheel slows, the cost spreads to five groups, in rough order of exposure.

Common shareholders

“If we decide to sell $1 billion of MSTR stock and buy $1 billion of Bitcoin… when you do it at 1.0x MNAV… it is dilutive. It is a minus 48 basis point yield. It costs the shareholders $310 million,” Michael Saylor, Executive Chairman, Strategy, said during Q1 2026 earnings call.

Existing owners are left holding a smaller claim on the same coins, and that dilution is how the strategy gets funded.

The copycats have fared worse than the original. Their shares once traded far above the Bitcoin they held, lifted by hype.

As that premium faded, many Bitcoin treasury company stocks fell much harder than Bitcoin itself, leaving late buyers deep underwater.

“If that’s not already a bubble burst, how would that bubble burst?” Tom Lee, Chairman of BitMine, said while many treasury stocks traded below net asset value.

This group never chose the bet. MSCI has proposed removing companies whose digital assets exceed half their total assets from its global indexes.

Convertible bondholders and preferred shareholders