Strategy has reassured investors after the company reported massive paper losses tied to Bitcoin’s latest downturn, downplaying fears around its debt load and insisting the firm remains financially stable unless the cryptocurrency collapses to extreme levels for years.
Earlier last week, the firm disclosed $17.4 billion in operating losses, driven primarily by unrealized losses on its Bitcoin reserves following a deep market correction. Net losses for the period totaled $12.6 billion, a sharp deterioration compared with a $671 million loss recorded a year earlier.
Despite the scale of the losses, Strategy executives insist the balance sheet remains resilient. CEO Phong Le, speaking during a fourth-quarter results webinar on Friday, said meaningful debt stress would only arise in an extreme, prolonged scenario.
“In the extreme downside, if we were to have a 90% decline in Bitcoin price and the price was $8,000, which I still think uh is pretty hard to imagine,” Le said.
He emphasized that such a scenario would require Bitcoin to remain at $8,000 for five to six years, a situation he described as highly unlikely.
Meanwhile, XDCVBN, Chief Financial Officer Andrew Kahn, reinforced the firm’s long-term commitment.
“During Q4, uh, Bitcoin, as we all know, experienced a price decline, which drove the total unrealized fair value loss of $17.4 billion.” He stated. “It can also be unsettling, but it’s important to emphasize that our strategy is built for the long term.”
Elsewhere, Michael Saylor, the firm’s Executive Chairman, echoed that message, urging investors not to overreact to quarterly swings.
“These quarterly fluctuations can be sharp and alarming,” Saylor said. “But it’s important to emphasize, our strategy is long-term. It’s designed to withstand short-term volatility and even the extreme conditions we’re seeing today.”
Saylor also addressed concerns surrounding the potential quantum computing threat to Bitcoin, dismissing near-term fears as exaggerated.
“Our position on quantum computing one, we think it’s probably 10 10 or more years away before there’s a threat,” he said. “The technology is promising, but it’s still in its early stages.”
He added that quantum risks extend far beyond Bitcoin, affecting financial systems and national defense infrastructure that rely on traditional cryptography. According to Saylor, Bitcoin can adapt through upgrades achieved via global consensus.
At press time, Strategy held approximately 713,502 BTC, making it the largest corporate holder of Bitcoin. Much of that position was accumulated during the late-2024 rally, when Bitcoin briefly traded above $126,000.
The company’s average purchase price stands at $76,000 per coin. Just four months ago, those holdings represented a paper gain of roughly $31 billion, underscoring the severity of the recent reversal.
Source: https://zycrypto.com/strategy-downplays-17-4-billion-loss-says-debt-safe-unless-bitcoin-hits-8000/
