According to Bloomberg, the publicly traded company Strategy has updated its stock issuance regulations, allowing ordinary shares to be sold for fundraising even when the company's stock price is less than 2.5 times its Bitcoin holdings value. This breaks the 'mNAV premium' bottom line set by CEO Michael Saylor in the past, meaning the company will have greater flexibility to respond to the current market environment and continue to advance its Bitcoin strategy.
Premium narrowing, financing difficulty increasing
According to data, since November 20, 2024, Strategy's stock price has fallen by 22%, while Bitcoin has risen by 23% during the same period, leading to a significant narrowing of the premium space between the stock price and Bitcoin's net asset value.
This weakens the company's ability to raise funds by issuing new shares at high valuations. Recently, Strategy purchased 430 Bitcoins worth $51.4 million in the week of August 17, an increase from the previous week's 155, but the overall pace of accumulation has slowed compared to previous years.
The company currently holds approximately $72 billion in Bitcoin, remaining one of the largest corporate holders in the world.
Strategy adjustment and market perspective
Clear Street Managing Director Brian Dobson believes the new regulations will allow Strategy to buy Bitcoin more strategically when favorable market opportunities arise. Conversely, some market participants warn that this move will increase risks for shareholders. Since the stock price no longer needs to maintain a high premium, the company can issue shares for fundraising at lower prices, which may dilute shareholders' holdings. More importantly, if Bitcoin prices experience a pullback, Strategy will face a double blow of 'asset shrinkage + equity expansion'. Notable short seller Jim Chanos bluntly stated that the company's rate of Bitcoin purchases has significantly decreased, and the original 2.5 times mNAV lower limit has essentially been canceled.
Overall, this change means that Strategy's financial structure will be more highly tied to the long-term trend of Bitcoin. In other words, the company is betting more risk on the long-term rise of Bitcoin; if the market continues to strengthen, it will further solidify its position as a 'corporate-level Bitcoin vault'; but if the market reverses, financial pressure will also be magnified.
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