Strategy's stock must trade above $183.19, which corresponds to a Bitcoin price around $91,502 assuming a multiple net-asset-value of 1.
Bitcoin News
Strategy won't need to liquidate any of its 641,205 Bitcoin (BTC) holdings during the next bear market, according to crypto analyst Willy Woo. He stated on Wednesday that it would require an exceptionally sustained downturn to force the company into selling positions to cover debt obligations.
The firm holds approximately $1.01 billion in debt maturing Sept. 15, 2027. To avoid liquidation pressure, Strategy's stock must trade above $183.19, which corresponds to a Bitcoin price around $91,502 assuming a multiple net-asset-value of 1. Woo's analysis suggests the company has a substantial cushion before facing distress.
Strategy's debt consists primarily of convertible senior notes that the company can settle with cash, common stock, or a combination at its discretion. Bitcoin analyst The Bitcoin Therapist agreed with Woo's assessment, noting the asset would need to "perform horribly" for Strategy to face liquidation pressure.
Strategy's stock closed Tuesday at $246.99, down nearly 6.7% and marking a seven-month low. The decline came as Bitcoin traded at $101,377, down 9.92% over seven days. Despite the recent weakness, Woo doesn't anticipate forced selling during the anticipated next bear cycle.
However, Woo warned of a potential "partial liquidation" scenario if Bitcoin fails to rally sufficiently during the expected 2028 bull market. He noted ironically that Strategy could face pressure not from a bear market but from insufficient gains during the subsequent recovery phase.
Several prominent executives have made bullish long-term price predictions for Bitcoin. ARK Invest CEO Cathie Wood and Coinbase CEO Brian Armstrong both forecast that the asset will reach $1 million by 2030. Such appreciation would provide Strategy with an enormous buffer against any liquidation concerns.
The company's treasury strategy relies on the assumption that Bitcoin will continue to appreciate over multi-year timeframes. Michael Saylor has consistently advocated for corporate treasury allocation to the asset as protection against monetary inflation. Strategy pioneered this approach among publicly traded companies.
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