Tensions rise in the Bitcoin 
$78,258 market, with speculation suggesting that Strategy (MSTR) might be forced to sell its vast Bitcoin reserves due to a decline in stock value. Matt Hougan, the Chief Investment Officer at Bitwise, categorically dismissed these speculations as “completely incorrect.” According to Hougan, the drop in MSTR’s market value below its net asset value (NAV) doesn’t compel the company to sell its Bitcoin assets.
Concerns of Selling Pressure and Hougan’s Clear Response
Hougan emphasized that MSTR’s Chairman Michael Saylor’s unwavering stance on Bitcoin, alongside the company’s financial structure, negates the necessity for such sales. He further remarked that selling the approximately $60 billion in Bitcoin altogether would significantly disrupt the market, equating to nearly two years’ worth of ETF influx. Nevertheless, Hougan finds this scenario unrealistic since the company doesn’t have any debt maturing until 2027, and its current cash position is sufficient to meet short-term obligations.
The debate intensified following CEO Phong Le’s statement last week about potentially selling as a “last resort.” Le mentioned that if the company can’t access financing and its market value drops below its Bitcoin holdings, a sale could be considered to protect shareholder returns. Hougan, however, contends that this statement was misinterpreted and that current circumstances do not warrant such drastic measures.
Delisting Fear and Market Pressure
MSTR is pressured not only by crypto market stagnation but also by potential exclusion from the MSCI index. Morgan Stanley Capital International indicated in October that companies with over 50% crypto assets on their balance sheets might be excluded. Such a decision would force funds following the index to offload MSTR, increasing the sell-side pressure on the stock.
Despite a 24.69% decline in stock value over the last 30 days, closing at $186.01 last Friday, Hougan argues that the impact of such index additions or exclusions is often exaggerated. For instance, when MSTR was included in the Nasdaq-100 index last year, the expected sharp movement in stocks was not observed even though funds needed to purchase $2.1 billion.
In addition to this unfolding situation, similar discussions are occurring in the Ethereum 
$2,295 domain within the crypto market. Last month, some analysts speculated that major institutional players rebalancing Ethereum reserves could pressurize prices. Yet, like the MSTR debates, these claims lack definitive evidence, portraying large-scale institutional sales as a low-probability scenario in the current market conditions.
It seems that rumors about MSTR selling Bitcoin primarily feed on market fears. The company’s financial structure does not present an immediate forced-sale risk, and Bitcoin prices still remain above MSTR’s average acquisition cost. The potential for index changes might not wield the significant impact assumed, as seen in past instances. The real question is how the market will price these uncertainties and shape investor confidence.
