Strategy bankruptcy if Bitcoin falls to $74,000?…"Low likelihood based on financial structure"

Concerns were raised that Strategy (formerly MicroStrategy)'s financial soundness could be shaken if Bitcoin's price fell to $74,000, but major analysts drew a line, saying the possibility of bankruptcy is an overinterpretation.

According to a NewsBTC report on the 31st (local time), a Bull Theory analyst evaluated that even if Bitcoin falls to $74,000, which is cited as a key support level, Strategy's likelihood of falling into a financial crisis is low. They pointed out that recent market scenarios of 'forced selling' and 'liquidity crisis' do not adequately reflect the company's financial structure.

Strategy currently holds approximately 672,497 bitcoins, which is about $58.7 billion at market value. Meanwhile, the company's total debt is about $8.24 billion. Bull Theory explained that even if Bitcoin fell to $74,000, the value of the bitcoins held would be about $49.76 billion, far exceeding the debt. They judged that even in that case it would not be a structure that would fall into insolvency.

Analysts emphasized that Strategy does not use margin trading like hedge funds. The bitcoins the company holds are not set as collateral, and margin calls or forced liquidations due to price drops do not occur. They explained that most of Strategy's borrowings are composed of unsecured convertible bonds, so creditors cannot demand sale of bitcoins solely because of a price decline.

In terms of liquidity, short-term pressure is also limited. Strategy has secured about $2.188 billion in cash and cash equivalents, which can cover about 32 months of annual dividend and interest payments of about $750 million to $800 million. Analysts see this as lowering the possibility of short-term funding squeezes.

Nevertheless, external factors were cited as the background for Strategy's recent weakness. Since October, concerns about sell-offs by index-tracking funds spread as MSCI considered a regulatory change that could exclude companies holding more than 50% of assets in Bitcoin from the index. The final decision on the proposal is scheduled for January 15, 2026.

In addition, there was analysis that JPMorgan's raising of margin requirements for trading Strategy shares from 50% to 95% prompted some investors to reduce positions, and the resulting selling pressure affected the stock price.

However, Bull Theory cited 'dilution risk' as a long-term risk to be wary of. Because Strategy has repeatedly issued new shares to purchase additional bitcoins, continuous capital increases during a downturn could erode existing shareholders' value. In particular, the point that additional capital raising may be limited if the price-to-net-asset-value (NAV) ratio falls below 1 was presented as a medium- to long-term burden.

Meanwhile, Bitcoin was trading at about $89,200 at the time of writing, up about 1.5% in 24 hours. Strategy's stock also moved at around $157 per share, up about 1.25% in the same period.