Strategy: The Bitcoin Treasury With A Great Future

Summary Strategy has transformed into a Bitcoin treasury play, with performance now tightly linked to Bitcoin price movements. Key metrics to monitor for MSTR are forced liquidations, long-term HODLer behavior, and Bitcoin ETF flows, which provide clarity amid volatility. MSTR’s $8.2B debt is largely convertible and well covered by $2.25B in cash and substantial Bitcoin reserves, minimizing near-term financial risk. I remain very bullish on both Bitcoin and MSTR, expecting outsized upside as Bitcoin recovers, given MSTR’s leveraged exposure. Strategy ( MSTR ) has undergone one of the most dramatic corporate changes in recent financial history. The company started as a business‑intelligence software company and has since evolved into something very different: a publicly traded Bitcoin treasury firm. It has been some time since the company has traded on software fundamentals, competitive positioning, or enterprise‑SaaS metrics, among other aspects of that part of its business. While it still has that business, and it's not doing too bad, the performance metric of the company is solely based upon the price of Bitcoin. How Bitcoin goes, so goes Strategy. One of the things investors would be wise in considering is this: the transition to a Bitcoin treasury has attracted all the people that have very emotional views on the bull and bear outlook for Strategy. How they view Bitcoin is how they view strategy. How they emote over Bitcoin is how they emote over Strategy. I think the major reason for this, especially on the bear side, is a lot of retail investors bought near the top during a certain cycle or cycles, and when the trade went against them, they panic-sold and took huge losses. It's one thing to be a Bitcoin or Strategy bear based upon logic and reasoning. It's another thing to go on a negative attack with little or no data to back it up. In this article we'll look at why I believe Bitcoin and Strategy are going to rebound, and why positive sentiment will return - both for Strategy and Michael Saylor. Seeking Alpha Major Metrics to Watch With Bitcoin There are three key metrics to watch in regard to Bitcoin to get a feel for what's really happening during times of significant volatility. Having a grasp of these things will help to decide what's really happening under the engine, rather than the emotion that can accompany the wide swings in prices. They are forced liquidations, long-term HODLers, and Bitcoin ETF flows. These data points give a snapshot of how good or bad things really are, and you should go to metrics during times of anxiety that can come from investing in Strategy. Before I get into them, the other thing to consider is position sizing. Many investors can get dollar signs in their eyes and put a disproportionate amount of their investment capital into a company they believe can deliver solid returns for them. The problem is, when that happens, it can, and usually does, trigger buying and selling at the wrong times. Position sizing will result in a healthy weighing of your portfolio, which will limit losses in comparison to the overall portfolio, or better yet, provide confidence to hold on during the price swings. HODLers HODLing has changed as the market has increasingly recognized Bitcoin as a new asset class. Originally, it represented those that 'hold on for dear life.' In other words, they were determined to never sell their Bitcoin. More recently, those that HODL are measured in a variety of time frames . That doesn't mean the more recent HODLers aren't going to hold on for years, only that they weren't part of the early wave of HODLers that remain faithful to their original assertions and intent. The reason why it's important to include this as a metric is because it gives investors a look at a part of the Bitcoin market that remains consistent for long periods of time. That means that whatever volatility there is in the market doesn't come from true long-term HODLers. What that suggests is the newer investors taking positions in Bitcoin consider it as one asset class among many and trade it as such. On the other hand, those in it long term have a similar view as Michael Saylor and Strategy, which have no intention of ever selling their Bitcoin. Below is short- and long-term data (as of 2-10-2026) for those taking positions in Bitcoin. Newhedge Next, I took some of the information from the above data and provided a look at longer-term HODLers. Newhedge Forced Liquidations I can't overstate the importance of taking into account forced liquidations when it comes to Bitcoin. The reason for that is, the leveraged nature of MSTR in relationship to Bitcoin, means its share price will outperform Bitcoin on both sides of the play. When the price of Bitcoin drops, as it has been since its all-time high, it results in forced liquidations, which act as accelerants for the price, resulting in it declining beyond the fundamentals. It of course does the same on the upside of the play, allowing the share price of MSTR to soar beyond Bitcoin fundamentals as well. To get more clarity for the share price of MSTR and Bitcoin, forced liquidations must be taken into account because the resultant decline in share price no longer reflects the value of the stock in the near term, or as long as the price of Bitcoin remains under pressure from the leveraged price. Recently this has come into play in November 2025 and mid-January and early February 2026, where forced liquidations soared, bringing about a steep dive in price beyond a normal correction. For a deeper dive into forced liquidations, go here for my latest article. Bitcoin ETF Flows The third metric I watch is Bitcoin ETF flows. ETF flows are a response to Bitcoin price corrections and/or forced liquidations, so they don't add much for the investor in the regard. What it does help measure is when the ETFs are starting to balance off their inflows and outflows, providing insight into how the fund managers are responding to the volatile price movement and if they think the worst is over. That will have an impact on the price of MSTR and Bitcoin. Below is a chart showing the ETF Bitcoin flows for the last three months. Coinflows Over the last week (since 2-6-2026) inflows have easily surpassed outflows, meaning, at least for that period of time, there has been a change in sentiment since 1-16-2026, where outflows far surpassed inflows for a two-week period. There was a big day of big inflows on 2-2-2026, followed by three days of significant outflows. Since that time, inflows have been increasing. Looking ahead, if the inflows continue to be higher than the outflows, it will mean fund managers believe the worst may be over. MSTR and Covering Its Debt and Dividends In its latest earnings report MSTR stated it had long-term debt of $8.2 billion, with the majority of that being convertible. With cash reserves of $2.25 billion, it has enough capital to pay about 2.5 years of dividend coverage. Strategy CEO Phong Le also said this: “Bitcoin needs to go down to $8,000 a coin and sit there for five years up until 2032 before we really have a problem. Being able to satisfy the convertible notes.” Saylor has also said if there ever was an issue, the debt would simply be refinanced. Under the worst-case scenario, that is still at least six years away. But if it were required, it would be impossible to know whether or not the financing would, in fact, be secured. I don't see that playing out in any way, but there is always a slight possibility it could. That's especially true since its debt structure doesn't include collateralized loans, which means there is no risk associated with forced liquidation, contrary to what a lot of people on social media assert. Even under a period of lower prices, the debt load of MSTR is well covered. As for its annual dividend payout of $887 million as I write, it has over 54 years of coverage to meet its responsibilities with BTC and 30.4 months with cash. Strategy Concerning debt and dividends, the company is well positioned to cover all of it. That's a positive since Saylor has said MSTR will buy Bitcoin forever on a quarterly basis. Conclusion MSTR and Bitcoin are viewed by most in a binary way - you either think they'll appreciate in value over the long term, even though they'll do so with a lot of volatility, or you're a bear who believes the growth trajectory of Bitcoin and MSTR is unsustainable, being considered a disastrous place to put your capital. I'm very bullish on MSTR and Bitcoin and believe the price of both is poised to jump in the long term. The fact that MSTR is leveraged to the price of Bitcoin, by which I mean when Bitcoin accelerates higher, MSTR jumps much higher than Bitcoin. On the other hand, if it underperforms over the long term, the same thing happens on the negative side of the play, where it also underperforms the price of Bitcoin, which would result in severe losses if sold. Under current fundamentals and clarity, I don't see that happening, but there is always the possibility of a black swan, even if it's a remote possibility. As it stands today, I would focus on the three metrics mentioned above to get as emotion-free a look at what is really happening with Bitcoin, which will be directly reflected in the price of MSTR. They aren't the only metrics to watch, but I think they're the most important. MSTR is actually positioned very well for what I believe will be the long-term growth of Bitcoin, and when the price sustainably recovers, those holding MSTR are going to be very happy with the results.