Strategy’s Bitcoin Bet Faces a Critical Test as Shares Trade Below Asset Value

Strategy US5949724083

A fundamental pillar of Strategy's business model is showing signs of strain. For the first time in a considerable period, the company's share price has fallen below the net asset value of its substantial Bitcoin holdings. This shift raises a pivotal question about the sustainability of its growth strategy, which has long relied on continuous capital inflows from equity markets.

January 2026 has been a month of aggressive accumulation for Strategy. In its most recent move, the firm purchased 2,932 Bitcoin between January 20 and 25, paying an average of $90,061 per coin. This transaction, valued at approximately $264 million, marks the company's fourth major acquisition of the month.

Earlier, between January 12 and 19, Strategy had already acquired about 22,305 Bitcoin for $2.13 billion, as reported by Reuters. These purchases were funded through its existing at-the-market (ATM) equity program. The company issued 1,569,770 new Class A shares, raising net proceeds of roughly $257 million, alongside 70,201 perpetual preferred shares (STRC) that brought in an additional $7 million.

The firm's total Bitcoin treasury now stands at 712,647 BTC. Across all its purchases, Strategy has invested approximately $54.19 billion, resulting in an average cost basis of $76,037 per Bitcoin.

The Valuation Dilemma: A Discount Emerges

The critical development is found in the market's current valuation of Strategy. The key metric is the multiple to net asset value (mNAV), which compares the share price to the underlying Bitcoin value per share.

According to an analysis from Yahoo Finance, the diluted mNAV was approximately 0.94 as of January 26. This figure indicates that Strategy's stock is trading at a discount of about 6% to the Bitcoin-backed value of each share. This is more than a minor detail; it strikes at the core of the company's operational engine.

The model has historically depended on the ability to issue new shares at a premium to NAV. When shares trade above intrinsic value, new issuances increase the Bitcoin holdings per share, thereby creating value for existing shareholders. When the relationship inverts and shares trade at a discount, further equity issuance risks diluting, rather than enhancing, per-share value.

Accelerated Accumulation, Minimal Per-Share Gain

The dynamics of January clearly illustrate this emerging tension. Data reported by the company and analyzed by Yahoo Finance reveal a telling snapshot:

• On January 5, Strategy held 673,783 BTC against 345.6 million diluted shares.
• By January 26, its holdings had grown to 712,647 BTC, but the diluted share count had also risen to 364.2 million.
• Consequently, the amount of Bitcoin per diluted share increased by a mere 0.38% over the month.

In essence, while the company's total Bitcoin pile is growing rapidly, the benefit accruing to each individual shareholder is increasing only marginally. This is the precise point where the model encounters friction once the market ceases to award the stock a premium.

A Leveraged Treasury Dependent on Market Access

Strategy has effectively transformed into a highly leveraged Bitcoin treasury. Its holdings now represent roughly 3.4% of the total possible Bitcoin supply of 21 million coins. With Bitcoin prices fluctuating between $87,500 and $89,000, the market value of the portfolio is around $62 billion, representing unrealized book gains of approximately $8.3 billion against the cumulative investment.

However, this entire structure is contingent on perpetual, unfettered access to capital markets. Yahoo Finance notes that over the past 19 months, Strategy has raised about $18.56 billion solely through the issuance of new common stock. The wider the gap between the share price and its intrinsic value grows, the more problematic each subsequent capital raise becomes.

The share price performance underscores the mounting pressure. Currently trading near €136, the stock is down more than 65% from its 52-week high, with a 12-month performance showing a decline of nearly 59%.

Financially, the company still has considerable dry powder. Its common stock ATM program alone has approximately $8.17 billion remaining, according to Bitcoin Magazine. This is supplemented by several preferred share programs (STRK, STRF, STRC, STRD), which together offer potential additional fundraising capacity in the tens of billions.

Upcoming Catalyst: Management's Response

The next opportunity for a strategic assessment is scheduled for February 5, 2026. On this date, Strategy will release its fourth-quarter 2025 results and host a live webinar to elaborate on its Bitcoin strategy. This event will provide concrete insight into how management plans to navigate the valuation dilemma—balancing further Bitcoin accumulation against the threat of shareholder dilution—and what priority continuous capital market access will hold in its future plans.

@ boerse-global.de | US5949724083 STRATEGY’S