Bitcoin Updates Today: MicroStrategy’s Bold Bitcoin Move: Challenging Doubters or Setting Off a Ticking Bomb?

MicroStrategy Maintains Its Bitcoin-Focused Approach Despite Market Uncertainty

MicroStrategy, a leading corporate holder of Bitcoin, has reiterated its unwavering dedication to a digital asset-driven strategy, even as market doubts and stock price swings intensify. The company currently possesses 641,692 BTC—about 3% of the entire Bitcoin supply—and asserts that its financial position remains robust, even during significant price drops. For example, with Bitcoin valued at $74,000, the company’s convertible debt coverage ratio is 5.9; if Bitcoin falls to $25,000, this ratio decreases to 2.0. This so-called “BTC Rating” is intended to reassure lenders, though it has not fully eased shareholder worries about potential dilution and unpredictable earnings.

Since 2025, MicroStrategy has aggressively acquired Bitcoin, financing these purchases through $21 billion in equity and debt offerings. This bold move has shifted the company’s identity from a traditional software provider to a highly leveraged Bitcoin proxy.

However, this strategy has introduced structural challenges. The company’s profits are now closely tied to Bitcoin’s price, while its ongoing expansion depends on continual capital raises. Over the last two quarters, institutional investment in MicroStrategy has dropped by $5.38 billion, reflecting broader market caution and skepticism about the company’s funding approach.

MicroStrategy’s stock performance is now directly linked to Bitcoin’s price movements. After a 68% decline from its 2024 peak, the company’s market value is now close to its net asset value (NAV), a sharp departure from its previous premium. The NAV premium has narrowed significantly, falling from 2.5 times in December 2024 to just 1.16 times by late 2025. Both retail investors and analysts have voiced concerns about the company’s reliance on issuing new shares, with some critics describing it as a “leveraged crypto time bomb.”

Shifts in Bitcoin Custody and Transparency

MicroStrategy has also adjusted its Bitcoin custody strategy. In 2025, the company moved 58,000 BTC (worth $5.1 billion) to Fidelity Digital Assets, diversifying away from exclusive reliance on Coinbase. While this change aligns with institutional standards for managing operational risk, it has reduced the transparency of on-chain holdings, making it harder for retail investors to monitor the company’s solvency in real time. Currently, MicroStrategy holds 165,709 BTC with Fidelity, prioritizing backup security over direct visibility, according to industry experts.

Index Inclusion Challenges

Eligibility for major stock indices remains a contentious topic. Although MicroStrategy meets the size and liquidity requirements for the S&P 500, it remains excluded due to not achieving four consecutive quarters of positive earnings—a hurdle largely attributed to Bitcoin’s volatility. This exclusion limits passive investment in the stock, leaving the company dependent on active investors who must weigh the risks of leverage, dilution, and earnings tied to Bitcoin’s price.

Potential Impact of MSCI Index Review

The upcoming MSCI index review in January 2026 introduces further uncertainty. If MSCI decides to exclude companies with more than half of their assets in digital currencies, MicroStrategy could be subject to forced selling by passive investment funds. JPMorgan projects that such a move could result in $2.8 billion in outflows, potentially rising to $8.8 billion if other index providers follow suit. Despite these risks, Executive Chairman Michael Saylor has downplayed the threat, stating that the market has already accounted for possible volatility.

MicroStrategy’s Ongoing Influence on the Bitcoin Market

Despite facing numerous obstacles, MicroStrategy continues to play a significant role in the Bitcoin ecosystem. With $56.14 billion in Bitcoin held across Coinbase and Fidelity, the company represents a major force in institutional demand. Its actions are closely watched by market participants, as they can either stabilize or intensify Bitcoin price movements. While some question the sustainability of MicroStrategy’s leveraged approach, supporters believe that long-term gains in Bitcoin’s value will ultimately validate the company’s strategy.