Michael Saylor's Strategy Just Boosted Its Cash Reserve to $3.75 Billion. Here's Why I'm Bearish on the Stock.
Strategy's Bitcoin business model is showing signs of cracking.
Overview
The good news, if you're a Strategy (NASDAQ: MSTR) investor, is that the world's biggest Bitcoin (CRYPTO: BTC) treasury company is taking major steps to repair its balance sheet. Its cash reserves now stand at $3.75 billion, and the company has publicly committed to propping up its share price.
The bad news, however, is that it might be a case of too little, too late. Strategy (the company formerly known as MicroStrategy) hasn't bought any new Bitcoin in over five weeks, and the value of its common and preferred stock continues to decline, no matter what CEO Michael Saylor does.
Details
This may be oversimplifying things, but the price of the stock can only go up if the price of Bitcoin goes up. And that's simply not happening in 2026. The crypto market is down nearly 30% for the year, which puts Strategy in a quandary.
Source
Originally published at www.fool.com.