MicroStrategy's stock has fallen quite harshly in the past six months, with its price already halved. Will it be unable to hold on and face liquidation? If that really happens, will it trigger a chain reaction of explosions?
MicroStrategy's CEO Phong Le (the company's Executive Chairman is Michael Saylor) recently stated quite frankly in an interview that unless the company's stock price falls below its net asset value and they cannot obtain new funding at all, they will not consider selling Bitcoin.
In other words, if MicroStrategy's price-to-net asset ratio (or mNAV) falls below 1 and all financing channels are cut off, then from a financial perspective, selling Bitcoin to protect earnings per share would seem reasonable, especially since there may already be losses on the books at that time.
However, he also emphasized that this is absolutely the last resort and not a shift in company strategy. MicroStrategy has never wanted to become a company that survives by selling Bitcoin; it's just that when market sentiment is particularly poor, financial discipline must come first, and they cannot rely solely on emotions.
MicroStrategy has endured this long in the cryptocurrency space and indeed has its own coping logic. Simply put, their bottom line is that as long as the mNAV does not fall below 1 and they can still borrow money, they will not touch Bitcoin.
So how is the price-to-net asset ratio calculated?
According to the data publicly disclosed by MicroStrategy, they currently hold approximately 649,000 Bitcoins, valued at around $59.2 billion at market price. Although the average cost is $74,000, the current Bitcoin price is even higher, so there is still a profit on the books. The estimated mNAV is around 1.13, which means the stock price is still above the net asset value per share
