MSTR Slides as Bitcoin Drops, Underscoring Debate Over True Valuation

Bitcoin faced another tough trading session as the price slipped nearly 3% to around $98,600, adding pressure across crypto-related equities. One of the biggest decliners was Strategy (MSTR), the largest corporate holder of bitcoin, which fell more than 6.6% to trade near $210. This marks a return to price levels last seen just before Donald Trump’s election last November. Despite the company’s long-term gains since adopting a bitcoin-focused treasury strategy in 2020 under Michael Saylor, the stock is still down 30% year-to-date and 36% over the past twelve months.

The decline in MSTR relative to bitcoin sparked a wave of commentary on social media, with some traders suggesting the stock had entered a “buy zone.” Their claim centered on the market cap slipping below the value of the company’s massive bitcoin holdings, suggesting Strategy was trading at an mNAV discount. The company currently holds 641,692 BTC, worth roughly $63.2 billion. With its market cap sitting near $60 billion, some argued that MSTR shares were undervalued by comparison.

However, this narrative overlooks critical financial components. Strategy’s significant preferred equity and outstanding debt both take priority over common shareholders and must be included when assessing valuation. Once these obligations are factored in, the company’s enterprise value climbs to about $75.4 billion — nearly 20% above the value of its BTC reserves. The company’s own dashboard reflects this reality, listing its mNAV at 1.19, clearly showing that MSTR is not trading at a discount to its bitcoin assets when liabilities are properly accounted for.

Whether Strategy stock ultimately proves undervalued or overpriced will depend on market sentiment, bitcoin’s future performance, and the company’s ongoing strategic execution. But based on current figures, the idea that MSTR is trading below the value of its bitcoin simply doesn’t hold up.