What Strategy (MSTR) is Today

MicroStrategy, now known simply as Strategy (MSTR), started as a business intelligence software company, but the core identity today is very different. The company now operates as a public vehicle for long-term Bitcoin accumulation. Almost every financing move is designed to increase its Bitcoin holdings, and that has become the primary driver of shareholder value.

Strategy also fills an important role for both institutional and retail investors who want bitcoin exposure but do not fully trust crypto exchanges or their fee structures. Traditional brokerages charge little to no trading fees, while crypto platforms can charge up to 5% per transaction. This means a simple buy-and-sell cycle can cost investors 10% of their profits. Holding MSTR allows investors to participate in bitcoin’s upside, sell quickly on the downside, all without dealing with those frictions.

Bitcoin: The Asset Behind Strategy’s Value

Bitcoin remains the defining factor in Strategy’s valuation. With a fixed supply of 21 million coins and a 16-year history of halving cycles, institutional inflows, and volatility, it is treated as a digital reserve asset rather than a payment network.

Where Bitcoin Fits in a Modern Portfolio

At this point, it’s clear to investors that tech leaders like NVDA and the rest of the “Big 7” have been the strongest investment vehicles post-Covid. Even outperforming the S&P 500. But, with all the talk about a potential AI bubble, it makes sense to diversify into other asset classes rather than getting caught in a single narrative.

Traditionally, that meant treasuries, bonds, and natural resources like gold. Treasuries and bonds are a little too safe for the active retail investor and don’t yield enough gains on their own. Gold is popular because it moves in the opposite direction of stocks and works as a great hedge during bad times. And after the post-Covid period, one takeaway has become obvious: “digital gold” aka Bitcoin has been a stronger long-term performer. Since 2020, Bitcoin has outpaced Gold by an enormous margin.

Asset	Jan 2020 Price	Dec 2025 Price	Total % Gain	Annualized % (CAGR)
Bitcoin	$7,200	$86,000	1,094%	50%
Gold	$1,520/oz	$2,650/oz	74%	10%
© Developing Different – Bitcoin vs Gold Growth Analysis

We won’t continue to see those kind of gains forever, but the shift in investment sentiment from gold to Bitcoin is undeniable.

How MSTR Traded Through the 2025 Bitcoin Cycle

Before getting into Strategy’s balance-sheet details and valuation metrics, it’s helpful to see how the stock has actually behaved this year alongside Bitcoin, the broader market, and a leading growth name. The chart below shows the relative performance of MSTR, Bitcoin, SPY, and NVDA throughout 2025.

With that context in place, we can now look at what’s actually driving MSTR’s valuation and stock price beneath the surface: Bitcoin. Rather than trying to predict crypto’s volatility, we’ll focus on how MSTR’s fundamentals behave within that environment and how one can stand to profit.

The Numbers That Really Drive MSTR’s Valuation

Strategy’s valuation is ultimately a function of two moving parts:
(1) how much Bitcoin the company owns, and
(2) how the equity markets price that Bitcoin exposure through MSTR’s outstanding shares.

Because Strategy continuously issues stock to buy more Bitcoin, the relationship between Bitcoin value and MSTR market cap shifts throughout the year. At times, the market prices MSTR at a discount to its underlying Bitcoin, creating an attractive entry point; at other times, enthusiasm pushes the equity above the value of the coins it holds.

The table below shows these dynamics across 2025: how outstanding MSTR shares, Bitcoin balances, and market prices interact. The goal is not just to compare numbers, but to identify when equity value diverges meaningfully from the company’s Bitcoin-based intrinsic value. I’ve labelled these appropriately with “BUY” and “SELL”.

Period 2025	MSTR Shares Outstanding (Million)	Bitcoin Holdings (BTC)	Bitcoin Value ($)	MSTR Stock Market Cap ($)	Notes
January	190M	500,000 BTC	$46B ($92k/BTC)	$24B ($125/share)	Share market cap is far below Bitcoin Value (BUY)
June	260M	600,000 BTC	$63B ($105k/BTC)	$39B ($150/share)	Share cap increasing but Bitcoin is too at a faster rate (BUY)
October	280M	640,000 BTC	$71B ($110k/BTC)	$80B ($285/share)	Share cap surpasses Bitcoin value (SELL)
December (current)	287M	650,000 BTC	$56B ($86k/BTC)	$48B ($166/share)	Bitcoin appears to have oversold and is going back up (BUY)
© Developing Different – MSTR Bitcoin Treasury Analysis

The key metric to watch is the spread between “Bitcoin value ($)” and MSTR’s “Stock market cap ($)”, and right now that spread favors buyers. Review the 2025 chart above and see how the BUY/SELL in the table corresponds perfectly.

BTC needs to drop to $73k/BTC for parity to MSTR market cap, so buffer exists.

Why Strategy Isn’t as Financially Fragile as Headlines Claim

If you’re worried that Strategy is on the verge of collapsing, or that its aggressive Bitcoin strategy is reckless, the data says otherwise. Despite dramatic headlines calling this a Ponzi scheme, this is not a company gambling shareholder capital for a quick win. Saylor and the executive team have been intentionally structuring Bitcoin acquisitions, leverage, and liquidity in complex ways that preserve optionality and protect shareholders through volatility.

Below is a breakdown of why Strategy’s financial position is much stronger than the headlines suggest.

Institutional Investment in MSTR

Institutional ownership sits near 60%, and the last 12 months show steady accumulation despite volatility. Roughly 863 institutional buyers added $7.19B in exposure (more buys than sells). For full position data and fund-by-fund details, you can view the breakdown here: MSTR Institutional Ownership Data ↗

The shareholder base is anchored by the usual market heavyweights, such as Vanguard, Capital International, State Street, and Geode, with each holding multi-billion-dollar positions. Even Norges Bank, Norway’s sovereign wealth fund manager, increased its stake with a recent purchase of roughly 4.9M shares.

Dilution and Debt Strategy

Strategy continues buying Bitcoin through two primary levers:
(1) ATM equity issuance via its $4.2B program
(2) Preferred stock offerings (STRK, STRF, STRD, STRC, STRE)

Equity Issuance

Shares outstanding have risen 52% YTD to 287M. While dilution is never ideal, Strategy’s balance sheet offsets the risk. Strategy is sitting on $1.44B in cash (as of Dec 1, 2025), which is more than enough to cover interest, dividends, and near-term debt without selling Bitcoin.

Preferred Stock Series

Strategy now lists multiple securities: common stock (MSTR), and preferred stock series (STRK, STRF, STRD, STRC, STRE).

These are not separate companies or spinoffs. These are different share classes within same capital structure.

The preferred stock series appeal to yield-oriented and income-focused investors: who want exposure to Strategy’s Bitcoin treasury via fix-income style investment, without the volatility of common stock (MSTR). This gives Strategy another channel to acquire more Bitcoin without “directly” diluting MSTR shareholders.

STRC raise example: Proceeds from STRC raised $2.5 Billion, which brought in 21k BTC at roughly $117k each. Strategy Announces Closing of 2.521 Billion STRC ↗

Preferred shares come with crucial structural advantages:

• No voting rights: no governance dilution for common shareholders.
• No fixed maturity: Strategy is not required to repay principal on a set schedule, to protect during extreme volatility.
• Dividends accrue: debt holders never lose out on payment.
• Redemption: Strategy chooses when. Based on board approval and factors in cash flows, BTC sales, or future capital raises.
• Access: limited to institutional/accredited investors, not general public-retail

In short: preferred acts like permanent capital. It does not create the near-term refinancing pressure that traditional debt does.

Series	Dividend Frequency	Initial Start Date	Rate Structure	Notes
STRK	Quarterly	March 2025	Fixed 8-10%	Cumulative, cash/stock
STRD	Quarterly	September 2025	Fixed/Variable	Compounding, optional repurchase
STRC	Monthly	August 2025	Variable	Adjustable rate
STRF	Quarterly	Varies	Fixed 9-10%	Senior, liquidation priority
STRE	Quarterly	December 2025	Fixed, up to 18% deferred	Penalty rate, tax redemption
© Developing Different – Strategy Preferred Series

The Real Risk-Reward Profile of MSTR

At this point, the story is clear: Strategy (MSTR) is not a simple Bitcoin proxy. It’s a leveraged Bitcoin treasury with a sophisticated capital structure, deep institutional backing, and one of the most aggressive accumulation strategies in public markets. But none of this makes it a “safe” investment. MSTR and Bitcoin remain extremely volatile, and price swings of 20–40% are not out of the ordinary.

For passive or risk-averse investors, that level of volatility is hard to stomach.
But for active, value-oriented investors, however, the recent drawdown in both Bitcoin and MSTR is precisely the environment where outsized returns tend to emerge.

MSTR has already absorbed a significant decline while Bitcoin corrected. Now that Bitcoin is showing signs of recovery from deeply oversold levels, investors with a 6-12 month horizon are positioned to capture the most upside.

Still, this is a high-risk, high-reward setup. For investors who can handle short-term turbulence and hold through a full cycle, the probability of doubling capital from current levels is materially higher than recent sentiment suggests. Bitcoin isn’t going away anytime soon, and neither is Strategy.

Be greedy when others are fearful.

If you’re still interested after weighing the risks, the next section lays out investment approaches.

Structured Approaches for Investing in MSTR

This final section outlines structured approaches for investors who want exposure to MSTR or Bitcoin, whether through medium-term positioning, or a long-term accumulation plan.

The goal isn’t to gamble or chase hype, but to apply structure and discipline to a naturally volatile asset.

Medium-Term Conviction Play

Description: For investors who believe bitcoin has bottomed.

This approach uses a bullish Put Credit spread, structured to generate income while defining maximum downside risk. The trade profits if MSTR stays above short strike $170 through February 2026. Because we hedge with a long put at $145, the maximum loss is capped, and margin requirements are reduced (if you are using margin, but not necessary).

Buy to Open (hedge leg):

• Trade: 1× MSTR -> Buy to Open -> Put
• Strike: $145
• Expiration: Feb 20, 2026
• Premium Target: ~$9 (varies)
• Cost: $900 total

Sell to Open (income leg):

• Trade: 3× MSTR -> Sell to Open $170 Puts
• Strike: $170
• Expiration: Feb, 20, 2026
• Premium Target: ~$17.45 (varies)
• Cost: $1745 x 3 = $5,235 total

Net Position:
+ $4,330 received upfront (net credit)

You collect this credit on day one. As long as MSTR closes above $170 on expiration day, all contract expire worthless and you keep the full amount.

Plan:

• Enter in ratio of 1:3 (1 long put, 3 short puts)
• Target closing the entire spread once 90% of the credit is realized, or
• Allow expiration if MSTR remains comfortably above $170
• If MSTR declines, the long $145 put provides downside protection and caps losses

Why This Works:

This trade thrives in sideways-to-up markets and offers a defined-risk structure. MSTR’s volatility inflates put premiums, allowing investors to earn meaningful income while positioning around a long-term bullish outlook.

Long-Term Conviction Play

Description: For investors seeking long-term exposure with high-capital efficiency.

This strategy uses deep-in-the-money call options to replicate stock ownership at a fraction of the cost. The goal is to participate in a multi-year Bitcoin recovery cycle with less downside drag than owning the stock outright and greater upside sensitivity.

Trade: MSTR -> Buy to Open -> Call
Strike: $100
Expiration: Jan 21, 2028
Premium Target: $100–$120
Cost: $10k–$12k per contract

Plan:

• Buy in sets of 2 contracts, then scale out systematically:
  • Sell 1 contract at $275/share (~60% gain @ Bitcoin $120k)
  • Sell 1 contract at $300/share (~80% gain @ Bitcoin $130k)

This approach removes emotion, locks in gains, and avoids the temptation to overstay during sharp Bitcoin-driven volatility.

Why:
Deep ITM calls mirror stock exposure with 50% built-in leverage compared to owning shares outright. They’re well suited for a 12-36 month Bitcoin recovery cycle because further downside slightly compresses the premium instead of falling dollar-for-dollar, while upside increases the premium 2-to-1 in your favor.

Final Thoughts

I hope you, the reader, walk away understanding MSTR: the risk/reward, corporate structure, and ways to trade it.

I’ve traded MSTR options consistently with great success since 2024, and the strategies above are the same ones I use myself. If you have questions, want clarity, or want to explore other approaches, feel free to reach out through the contact section or in the comments. Wishing you the best of luck in your investing journey.

Disclaimer: This is not fiduciary advice. Please do your own due diligence and take full responsibility for your actions.