Is The Bitcoin Treasury Bubble Popping? Expert Answers
MicroStrategy's market-implied net asset value (mNAV) premium has sharply decreased from 3.4x to 1.58x, indicating a decline in investor demand for its Bitcoin exposure. The company's valuation is now heavily influenced by its Bitcoin holdings, overshadowing its legacy software business. Recent changes in equity issuance strategy have sparked controversy, raising concerns about potential dilution of shareholder value and increased financial risk. A hypothetical scenario suggests that if Bitcoin's price drops by 20%, MicroStrategy's stock could plummet by 46.5%. The emergence of spot Bitcoin ETFs is also reducing the rationale for paying a premium for MicroStrategy's leveraged exposure. The mNAV premium is viewed as increasingly fragile, dependent on market confidence, capital access, and Michael Saylor's leadership.
