Bitcoin’s Momentum Builds Amid Sluggish Strategic Response

Bitcoin Rally Leaves Strategy Behind as Market Reassesses Premium and Funding Mix

Bitcoin’s climb past $107,000 this month has reignited bullish sentiment across digital assets, but not all major players are keeping pace. Strategy (MSTR), known for pioneering bitcoin treasury investments among public companies, is trailing behind with a 3% decline in its share price in May.

This disconnect has drawn attention to a key shift in market dynamics. While bitcoin has gained nearly 13% this month, Strategy’s stock performance has stalled, indicating growing investor scrutiny over its valuation and funding practices.

A central reason for the divergence lies in the compression of Strategy’s market-to-net asset value (mNAV), which has fallen to 1.80—its lowest level in nearly a year. This metric, which compares the firm’s enterprise value to the market value of its bitcoin holdings, is often viewed as a barometer of investor confidence in Strategy’s broader business model beyond BTC ownership.

With over 113 public companies now holding bitcoin—a notable increase from just a month ago—Strategy’s early-mover advantage is being diluted. The company’s ability to issue new equity, once a key weapon for financing bitcoin buys, is now constrained by a lower mNAV that makes shareholder dilution more significant.

To adapt, Strategy has diversified its capital strategy. Its most recent 4,020 BTC purchase, the smallest since early May, was funded through a blend of financing tools: 81.7% from common stock, 15.9% from STRK preferred shares, and 2.4% from STRF. Analysts interpret this as a tactical pivot to mitigate equity pressure while continuing to grow its bitcoin reserves.

Despite the stock’s lag, analysts say Strategy’s core thesis remains intact. But in an environment where the bitcoin narrative is being adopted by an expanding roster of public companies, Strategy will need more than conviction—it will need creativity and capital discipline to stay ahead.