Strategy Stock (MSTR): Bitcoin Treasury Investment Analysis vs. Spot BTC (2025-2030)

Michael Saylor's Microstrategy rebrands to "Strategy"... is it a better investment than spot BTC?

Microstrategy (MSTR) rebranded to “Strategy” yesterday (Feb 5, 2025) during their Q4 earnings call dropping the “micro-” prefix.

Why? To reflect MSTR’s top priority of functioning as a Bitcoin treasury company (with a tiny, almost irrelevant, software segment).

A subset of the general pop. thinks of MSTR as basically ~1.5-3x leveraged BTC to the upside and downside that can: (1) generate high ROI during rapid bull runs (outperforming BTC) and (2) crash harder to the downside during corrections (~2x downside).

Another subset of the general pop. doesn’t even understand MSTR at all. Many just buy MSTR because it’s a proxy for BTC in certain jurisdictions or on certain trading platforms (e.g. Vanguard) where they lack access to spot BTC ETFs. They are mostly unaware of things like NAV premium (they don’t know what this means.) (Read: Vanguard’s Bitcoin Hypocrisy).

In the past I’ve written about an arbitrage short MSTR long BTC strategy wherein, if MSTR has a high NAV premium and there’s at least a ~0.8-1.0 correlation between MSTR/BTC movements (up/down) over weeks/months, you can exploit the extra volatility of MSTR to generate free BTC.

Strategy’s strategy:

1. Raise Capital: Get USD (i.e. “fiat”) via various financial mechanisms (ATM equity, convertible bonds, Series A Perpetual Convertible Preferred STRK)

2. Buy Bitcoin (BTC): Make large aggressive Bitcoin purchases at various intervals (you can view these online via trackers) — like DCA’ing in.

3. Betting on BTC: Betting that BTC will appreciate in value significantly more than the costs associated with their financing — such that Bitcoin outpaces whatever Saylor needs to pay back via bonds/notes, shares, etc.

Strategy is willing to eat the short/mid-term (year-to-year) volatility of Bitcoin in exchange for long-term Bitcoin value appreciation… Saylor is essentially betting that Bitcoin’s ROI trounces whatever he’ll owe over the long-term.

Because MicroStrategy (MSTR) has evolved rapidly, many people (including MSTR investors) don’t really understand what’s happening anymore or how the company works.

There is a lot of confusion associated with MSTR in terms of:

1. Capital raise methods: The methods MSTR uses to raise capital are constantly evolving, but have included: ATM, convertible bonds/notes, and STRK shares (Series A Perpetual Convertible Preferred).

2. ATM (share dilution): A capital raise method that is often confusing for shareholders. MSTR uses an “at-the-market” (ATM) equity program to raise capital for BTC purchases, pay off loans, and cover other operational expenses.

3. NAV premium: Many are curious why MSTR typically has a NAV (net asset value) premium for BTC holdings relative to spot BTC. Essentially you’re getting less BTC for your $ if the NAV premium is positive.

4. Tax implications: It recently came to light that FASB and CAMT regulations may force MSTR to pay tax on unrealized Bitcoin gains in 2025. It’s possible they may be able to maneuver around this with a new IRS commissioner and/or Trump, but things don’t look great at the moment.

5. Risks if BTC drops: Many are curious as to what the company-specific risks are for MSTR if Bitcoin drops below a certain $ value (e.g. $16,500-$21,000). Many believe that MSTR could get “margin called” and cost investors everything.

6. Investment vs. BTC: Is MSTR a smarter investment than Bitcoin (BTC)? Many are confused about why MSTR outperformed BTC in 2024 and whether its outperformance is likely to continue. There are reasons some may prefer BTC and others may prefer MSTR based on risk tolerance and time-horizon.

The truth is that “Strategy” is not inherently a better or worse investment than BTC… it all depends on your comfort with risk, volatility, the “strategy,” and time-horizon (short-term trade vs. long-term hold, etc.).

I’ve put together this report to help people better understand how Michael Saylor and MSTR (Strategy) operates.

MSTR buyers: left & right

Note: Has nothing to do with IQ but I’d say you have 2 types of MSTR investors… those who understand the strategy and like it (brown hoodie) and those who buy MSTR cuz “number go up more than BTC” or “cuz Vanguard.” This makes for a unique blend of posts in “MSTR communities” on social media.

Strategy (MSTR) Overview 2025

Rebrand to Strategy: This change cements the Company’s identity as a “Bitcoin Treasury Company,” reflecting an ongoing pivot from traditional enterprise software to an aggressive BTC-acquisition vehicle.

Financial & BTC Highlights: In Q4 2024, the Company acquired a record 218,887 BTC, adding to its prior large holdings. Over $22 billion in total capital was raised in 2024, accelerating the “21/21 Plan.”

MSTR Stock vs. BTC:

• As of early 2025, MSTR trades around $325/share, while BTC sits near $96,000.

• Historically, MSTR has outperformed BTC during strong bull markets due to leveraged exposure and premium expansions, but it can underperform in stagnant or bear markets.

Strategy remains a high-volatility, potentially high-reward bet on BTC.

There is roughly a ~50–55% chance that MSTR outperforms BTC through 2030, possibly higher if BTC surges above key thresholds.

READ: Strategy SEC Filings & Documents Archive

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Strategy (MSTR): Q4 2024 Earnings Highlights

1. Rebrand from “MicroStrategy” to “Strategy”

In early 2025, the Company unveiled a major brand shift, simplifying its name to Strategy. The brand identity incorporates:

• Orange color palette: Signifying energy, creativity, and Bitcoin’s emblematic hue.

• Stylized “B”: Highlighting the Company’s Bitcoin-first strategy.

• Merchandise store at store.strategy.com to foster shareholder and fan engagement.

Alongside the brand change, Strategy reorganized its web presence:

• strategy.com: Investor info, real-time dashboards, and BTC metrics.

• strategysoftware.com: Featuring the legacy enterprise intelligence (BI) software solutions and new AI-driven analytics offerings.

This brand evolution underscores Strategy’s transformation from a decades-old BI firm into a highly visible public advocate for Bitcoin as “digital capital.”

2. Q4 2024 Business Performance & Financials

Record BTC Acquisition

• In Q4 2024 alone, Strategy acquired over 218,000 BTC—a historic quarterly haul.

• As of February 2025, the Company holds ~471,107 BTC total at a cost basis of about $64,500 per BTC. This cements its status as the world’s largest corporate holder of Bitcoin.

Software Segment

• Q4 2024 software revenue: $121 million, down ~3% year over year (YoY). This is mostly irrelevant IMO.

• Bright spot: Cloud-subscription sales rose by 48% YoY, reflecting strong demand for AI-powered analytics and indicating that the firm’s shift to cloud is gaining traction.

Capital Raisings

• Strategy tapped the equity markets via an aggressive at-the-market (ATM) program, raising over $15 billion in Q4.

• Issued a $3 billion zero-coupon convertible note (conversion premium ~55%) in November.

• By year-end 2024, Strategy had completed well over $20 billion of the total $42 billion target under its “21/21” capital plan, far ahead of initial timelines.

3. Series A 8% Perpetual Strike Preferred (STK)

In January 2025, Strategy raised $584 million in net proceeds via STRK stock, paying an 8% dividend and convertible into MSTR equity. This innovative security:

• Targets yield-focused investors seeking exposure to Bitcoin but with lower volatility than common shares.

• Complements Strategy’s existing toolkit of convertibles, ATM equity, and legacy software cash flows.

4. Shift to Fair-Value Crypto Accounting

Starting Q1 2025, Strategy will adopt new rules allowing fair-value accounting of its BTC. This change:

• Ends repetitive intangible-asset “impairments” that forced Strategy to record large non-cash charges whenever BTC’s market price dipped below cost basis.

• Makes GAAP earnings more closely mirror BTC’s mark-to-market gains/losses, potentially revealing less “noise” in quarterly reports.

5. CEO Michael Saylor’s 2025 Roadmap

• Continue leveraging capital markets—both fixed income and equity—to amass more BTC.

• Expand subscription-based software solutions, using stable cash flows for overhead and to avoid selling BTC.

• Explore Lightning Network integration and possible AI analytics synergy, aiming to extract incremental yield or revenue from BTC assets.

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Strategy (MSTR) Business Model & Financial Mechanics

1. Legacy Enterprise Software & AI Analytics (~5–10% of EV)

Despite the overshadowing Bitcoin narrative, Strategy remains a leading provider of business intelligence solutions. With total annual software revenue near $500 million, the BI and analytics arm:

• Funds day-to-day expenses, ensuring the Company rarely needs to liquidate BTC to cover overhead.

• Shows moderate declines in on-prem licenses offset by robust gains (+48% in Q4) in cloud subscriptions, reflecting the broader industry pivot to Software-as-a-Service (SaaS).

• Could see new AI-driven product suites integrated with or pivoting towards BTC analytics, further cementing Strategy’s technology credentials.

2. Bitcoin Treasury Operations (Core Value Driver)

Largest BTC Treasury

• Holding ~471k BTC at a ~$30+ billion cost basis. At current BTC ~$96k, the trove is valued around $45–$47 billion.

• New fair-value accounting rules let Strategy book market-driven BTC gains/losses each quarter, reducing intangible-impairment distortions.

Capital Allocation

• Bulk of capital raises (ATM equity, converts, perpetual preferred) flow into BTC acquisitions.

• Saylor positions Strategy as the “ultimate leveraged BTC play,” expecting to outpace BTC’s returns over time.

BTC Yield & BTC Gain (New Metrics)

• The Q4 2024 investor call introduced metrics like “BTC yield” and “BTC gain” to measure the incremental accretion of BTC per share from creative financing and equity issuance.

• The Company’s 2025 target: ~15% “BTC yield” plus $10 billion in “BTC $ gain,” further illustrating the synergy between high share premiums and more BTC acquisitions.

3. Financing & Capital Structure