MicroStrategy’s Market Cap Plunges Below Bitcoin Value After $14.5B Markdown
MSTR•Strategy’s market cap slipped below its 847,363 BTC holdings (mNAV below 1) after bitcoin dipped under $60K, forcing a $14.5B unrealized markdown and a $12.5B Q1 net loss. The company carries $6.75B debt, $15.5B preferred securities and cash covering less than one-year dividends, heightening dilution risks.
1. Bitcoin Position Pressure
Strategy holds 847,363 BTC at an average cost of $75,651 each. A bitcoin price decline below $60,000 reduced the value of these holdings, pushing mNAV under 1x and driving shares to annual lows.
2. Unrealized Loss and Net Impact
Compliance with FASB’s ASU 2023-08 requires fair-value marking each quarter, resulting in a $14.5B unrealized loss in Q1. This produced a $12.5B net loss, equating to $38.25 per diluted share.
3. Balance Sheet Obligations and Dilution Risks
The company carries $6.75B in debt and $15.5B in preferred securities, while cash reserves cover less than one year of dividends. Funding additional bitcoin purchases via equity issuances could further dilute common shareholders.
