MicroStrategy’s Premium Evaporates as Confidence Wanes

The investment thesis behind MicroStrategy, long considered the premier proxy for Bitcoin exposure, is showing significant cracks. The company once celebrated for its innovative approach to cryptocurrency investment now faces a severe valuation crisis. Its historical trading premium compared to direct Bitcoin holdings has nearly vanished, compounding concerns as corporate insiders liquidate their positions, raising fundamental questions about the sustainability of its business model.

A core metric distinguishing MicroStrategy from a straightforward Bitcoin investment has collapsed. The stock’s premium relative to its underlying Bitcoin reserves has plummeted to its lowest level since February 2024. Currently, shares trade at a multiple of just 1.21x net asset value, representing a mere 21% premium on the company’s $78 billion Bitcoin treasury.

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