Strategy Stock 2025: Bitcoin Strategy Meets Market Reality

The stock of Strategy Holdings, traded under the ticker MSTR, ended 2025 with an overall performance of approximately minus 49.35%. As a result, it was one of the weakest performers in the Nasdaq-100, despite the company continuously expanding its Bitcoin holdings and recording significant gains on its treasury assets. This discrepancy – profitable Bitcoin holdings alongside declining stock value – raises fundamental questions about Strategy’s structure.

Bitcoin Gains versus Stock Price: The Classification Paradox

By the end of the year, Strategy held 672,497 Bitcoin, acquired at an average cost of about $75,000 per coin. At current prices of nearly $87,800, this amounts to a valuation of around $59 billion – and an unrealized gain of approximately 17%. Executive Chairman Michael Saylor even estimated the company’s Bitcoin return for 2025 at 23.2%. At the same time, the stock price fell from around $300 at the beginning of the year to $151.42 after volatile fluctuations.

This decoupling is not coincidental but structural in nature. Strategy now functions less as a software company and more as an investment vehicle with a Bitcoin focus – a classification that has significant implications for index membership.

Why S&P 500 Inclusion for Strategy Remains Unlikely

At the end of 2025, Strategy formally met the key quantitative criteria of the S&P 500: sufficient market capitalization and profitability, driven by Bitcoin gains in net income. However, inclusion remains unlikely. The index committee prefers companies with operational business models over investment-dominated structures where treasury assets dominate profits.

The reason lies in how index management works: The S&P 500 aims to reflect the broad US economy, not serve as a vehicle for commodity or financial investment strategies. Companies like Tesla or Block also hold Bitcoin but generate most of their revenues and profits from diversified business activities – not primarily from treasury positions.

Comparison with Other Underperformers in the S&P 500

The year 2025 showed an overall uneven market development despite a strong S&P 500 year with approximately +17.3% (after +23.3% in the previous year). Several established large-cap stocks suffered massive price declines:

Fiserv experienced a drop of about minus 70%, after missing earnings expectations and reports of negative customer experiences. The Trade Desk fell around minus 68% due to slowing growth and increased competition. Sarepta Therapeutics was particularly drastic with over minus 80%, caused by safety concerns and regulatory warnings regarding gene therapy treatments.

In the context of these underperformers, Strategy with its approximately -47.5% decline does not appear exceptionally poor. The key difference, however, lies in the cause: while the mentioned companies suffered from operational and market challenges, Strategy’s failure is more related to its classification.

The Core Issue: Bitcoin Proxy Instead of Operating Company

Critics like Peter Schiff argue that Strategy’s aggressive Bitcoin accumulation came at the expense of shareholders. The criticism is less directed at Bitcoin itself – Bitcoin does not disqualify a company from the S&P 500 – but at the one-sided focus of the entire corporate strategy.

Strategy has effectively transformed into a closed-end fund with a Bitcoin focus. The S&P 500 committee evaluates inclusions not only based on current metrics but also considers sustainability, operational fundamentals, and business model clarity. A Bitcoin proxy structure does not meet these long-term expectations.

How Strategy Could Address the Valuation Issue

Historically, steep stock price declines have not been treated as automatic disqualification criteria – many current S&P 500 members have recovered from massive downturns. Likewise, strong price increases do not guarantee index inclusion.

If Strategy is to be included in the S&P 500, the company would need to structurally demonstrate that Bitcoin holdings do not dominate its business logic but that a diversified business model underpins it. Without this repositioning, S&P 500 inclusion remains a theoretical possibility with little practical likelihood.