Strategy Inc., formerly MicroStrategy, is known for boasting a bold promise: it will never sell its $66 billion of Bitcoin. However, this “never” promise comes with a very high and rising price tag. As of late 2025, the company is incurring $689 million in annual cash obligations simply to service the debt and dividends that were used to acquire its Bitcoin, a number that its actual software business cannot support.
This has effectively turned the world’s largest corporate Bitcoin holder into a high-wire financial act, one entirely dependent on investor faith and a continually rising stock price to pay its bills.
The ‘Bitcoin Yield’ Dilemma
Led by founder Michael Saylor, Strategy (which officially rebranded in 2025) is no longer just a software company; it’s the world’s first “Bitcoin Treasury Company.” Its primary goal is to achieve a positive “BTC Yield”—a metric for acquiring more Bitcoin per share, faster than it dilutes its stock.
Year-to-date, the company has been successful, accreting its holdings by 26.1%. But this growth is funded by a costly mechanism: selling new preferred shares (like STRK and STRF) that carry high dividend yields, some ranging from 8% to 10.5%. Every new Bitcoin purchase, therefore, adds to the mountain of annual cash obligations.
A Business That Can’t Pay the Bills
This model creates a significant cash-flow problem. Strategy’s legacy enterprise analytics software business is not a cash cow. While the company reported an impressive $3.9 billion in operating income in the third quarter of 2025, its own earnings report clarifies this was almost entirely due to the $3.9 billion in unrealized gains from its Bitcoin holdings under new fair value accounting rules.
In stark contrast, its actual total revenues for the first nine months of 2025 were less than $355 million. This is not nearly enough to cover the $689 million in annual debt interest and dividend payments, a figure that company forecasts show will soon grow into the billions.
Relying on a ‘Multiple-to-Net Asset Value’
So, how does Strategy pay its bills without selling Bitcoin or generating enough revenue? By selling more stock. The company’s survival depends on its ability to issue new equity (both common and preferred) to pay the interest and dividends on its existing equity and debt.
This model works only as long as investors are optimistic. This optimism is measured by a key metric: the multiple-to-Net Asset Value (mNAV). This is the premium investors are willing to pay for MSTR stock versus the actual Bitcoin it holds.
The Premium of Trust
As of late 2025, investors are paying a hefty premium—a mNAV between 1.07x and 1.3x. In essence, they are paying 7% to 30% more for MSTR stock than if they just bought Bitcoin themselves.
Why? They are betting on Michael Saylor. They trust his ability to use the company’s corporate structure to raise capital and acquire more Bitcoin, growing the “BTC Yield” per share. This premium exists even though, as company lawyers disclose, owning MSTR stock gives shareholders no direct legal claim to the company’s $66 billion in Bitcoin.
A Perpetual Financing Machine?
Strategy has successfully purchased Bitcoin in every single quarter since 2020 and plans to continue “forever.” But this strategy has turned the company into a financial marvel, or a house of cards, depending on your perspective. Its annual costs are already nearly $700 million and rising.
To avoid selling its Bitcoin, it must successfully and perpetually sell new stock to a market that must remain perpetually optimistic. As long as the mNAV premium holds, the machine keeps running. If that faith—or the price of Bitcoin—falters, the entire model faces an existential test.
