Strategy’s Bitcoin Bet Faces $11.2B Paper Loss as BTC Drops Below Average Buy Price

Bitcoin’s decline below Strategy’s average acquisition price has dragged the company’s treasury deep into paper-loss territory, reviving questions about the durability of executive chairman Michael Saylor’s Bitcoin-accumulation model.

The firm’s 843,706-BTC holding has fallen to an unrealised loss of about US$11.2 billion (AU$15.79 billion). Data from BitcoinTreasuries put the position’s cost basis at US$63.8 billion (AU$89.96 billion) against a current value near US$52.6 billion (AU$74.17 billion). 

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Pressure Reaches the Stock

Bitcoin has dropped about 13.8% over the week and more than 20% over the month.

The strain extended to Strategy’s listed securities. MSTR shares slipped about 1.5% in pre-market trading and are down roughly 14% over the week, while the company’s STRC perpetual preferred stock traded near US$94.6 (AU$133.39), below its target value.

The weakness follows Strategy’s sale of 32 BTC late in May, its first disposal since 2022, to fund distributions on that preferred stock. 

That sale, small as it was, broke a long-standing pledge never to sell and sharpened questions about how the company services its obligations when Bitcoin falls and its equity premium narrows. 

Spot Bitcoin exchange-traded funds have compounded the pressure, shedding about US$4.4 billion (AU$6.2 billion) over 13 trading days as institutional demand cooled.

Saylor characterised the sell-off as a rotation of capital rather than a verdict on Bitcoin. “This is a capital rotation, not a Bitcoin impairment. Volatility creates opportunity,” he stated, linking the move to roughly US$400 billion (AU$564 billion) in spending on artificial-intelligence infrastructure that he argued is temporarily drawing investment away from digital assets.

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