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MicroStrategy (MSTR) shares faced intense pressure on Monday after an overnight crash in bitcoin’s price and news of an unexpected capital raise. The stock initially plunged 12.5% to its lowest level in nearly 15 months as bitcoin hovered near $85,000, showing no signs of recovery throughout the session. Despite the gloomy backdrop, MSTR staged a surprising afternoon comeback, trimming its losses to just 3.25% by the close—likely driven by aggressive short-covering rather than renewed investor confidence.
At its intraday low of $155.61, MSTR was down nearly 40% over the past month and 66% from its 2025 peak in mid-July. With the stock so deeply discounted, many bearish traders appeared to take profits, contributing to the late-session rebound.
The sharp decline followed MicroStrategy’s announcement that it had quietly raised $1.44 billion by selling common stock over the past several weeks. The funds are intended to cover preferred share dividends for the next 21 months, with the long-term goal of securing at least 24 months’ worth of payouts. The move signaled a dramatic shift for a company best known as the leading bitcoin treasury holder, currently holding around 650,000 BTC.
For many investors, the capital raise sparked concerns over dilution, fueling the heavy sell-off. Critics like gold advocate Peter Schiff seized the moment, arguing that MicroStrategy’s model—issuing equity to buy Treasurys yielding roughly 4% while paying out obligations costing 8–10%—is unsustainable. He labeled the business “broken” and accused CEO Michael Saylor of misleading investors.
Still, longtime bitcoin watchers note that Schiff has frequently declared the “end” of bitcoin-related ventures, only for markets to rebound shortly afterward. Whether Monday’s reversal signals a potential bottom for MSTR remains uncertain, but bullish traders are watching closely for signs that both bitcoin and MicroStrategy shares may stabilize after weeks of relentless pressure.
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