Strategy Shares Plunge to Unprecedented Discount

A remarkable valuation shift has occurred with Strategy, the company formerly known as MicroStrategy. On Thursday, its market capitalization fell below the value of its own substantial Bitcoin holdings for the first time in its history. This development marks a dramatic reversal for a firm once celebrated for providing investors with a leveraged, indirect pathway into cryptocurrency. The investment premise, long commanding a market premium, has now collapsed, leaving market participants to question whether this represents a compelling buying opportunity or signals the failure of the Bitcoin proxy model.

The company's market value dropped to approximately $63.5 billion following a 7.54% share price decline on Thursday. This places it below the $65.5 billion value of the 641,692 Bitcoin tokens held on its balance sheet. This milestone represents the first instance since Strategy initiated its aggressive Bitcoin accumulation strategy in 2020 that the stock has traded at a discount to its net asset value.

The longer-term perspective reveals an even steeper decline. Shares currently trade nearly 60% below their all-time peak of $543 reached in November 2024. This performance significantly undercuts Bitcoin's own comparatively modest correction during the same timeframe, indicating severe pressure specific to the company's equity.

Eroding Confidence in the Proxy Model

Several converging factors appear to be driving this loss of investor confidence. Enthusiasm for Bitcoin proxy investments has cooled considerably across markets. Regulatory uncertainties, particularly within Asian jurisdictions, have created headwinds for similar business structures. Furthermore, the company has faced mounting criticism over its inability to justify the previously sustained premium valuation.

Should investors sell immediately? Or is it worth buying Strategy?

Even the Q3 earnings report released on October 30th, which showcased robust net assets bolstered by substantial unrealized crypto gains, failed to stem the negative sentiment or provide any meaningful support to the share price.

Technical Position and Future Catalysts

As trading continues into Friday, attention focuses on whether the stock can establish support or if it will extend its decline toward technically significant 52-week lows. The Relative Strength Index (RSI) reading exceeding 84 indicates a severely overheated market—though in this case, the extreme momentum is concentrated on the selling side following weeks of sustained liquidation.

The next potential catalyst arrives with the Q4 2025 financial results, scheduled for release on February 3, 2026. Until then, the share price remains highly susceptible to Bitcoin's inherent volatility and ongoing questions about management's capacity to restore shattered investor trust. The established downward trend, combined with this new valuation gap, positions Strategy as a high-risk proposition—even for those maintaining a bullish outlook on Bitcoin itself.