Why MicroStrategy, the "face" of Bitcoin, lost trust

Welcome to the US Cryptocurrency Market Morning Brief — your one-stop for the most important industry news today. We’ve curated content worth reading over a cup of coffee. The Bitcoin-related premium of MicroStrategy, once regarded as a symbol of institutional investor trust, is now experiencing a significant crack in what was thought to be a solid foundation.

MicroStrategy’s Premium Indicator Faces a Historic Turning Point

MicroStrategy has long been recognized as a “model student” in Bitcoin investment. The gap between its stock price and the value of its Bitcoin holdings (the premium) has finally reached a point of disappearance. After about five months of pressure since mid-May, this historic divergence has been reached.

An astonishing figure has become reality. MicroStrategy’s market capitalization (currently $64.54 billion) has fallen below the valuation of its Bitcoin assets (worth $66.15 billion). This is the first time as a major corporate Bitcoin holder that such a reversal has occurred.

Why did this happen—limits of the fundraising model

The secret behind MicroStrategy’s vast Bitcoin empire was its unique convertible bond issuance strategy. This approach allowed the company to raise funds while avoiding dilution of existing shareholders, and to accumulate Bitcoin.

However, the tide has turned. The company holds 641,692 BTC at an average cost of $74,085 per coin, and even at the current market price near $102,918, it still secures an unrealized profit of 39.10%. Nevertheless, the attitude of convertible bond buyers has become more cautious.

Since February 2025, MicroStrategy has not issued new convertible bonds. Instead, it has been converting to preferred stock (STR series). These preferred stocks come with relatively high interest rates—reflecting a market environment where investors need stronger incentives.

Long-term Holders’ Profit-Taking Shakes Market Structure

Another aspect revealed by on-chain analysis also tells the story of current market tension. Data shows that long-term Bitcoin holders (LTH) are accelerating profit-taking around the $100,000 mark.

Glassnode reports confirm a rapid decrease in LTH supply and a sharp negative shift in net positions, suggesting veteran holders are distributing their holdings more quickly. The Vice President of Research at Fidelity Digital Assets also mentioned this trend, noting that recent price stagnation has exhausted veteran holders’ psychology.

MicroStrategy CEO at a Crossroads

For MicroStrategy, led by Michael Saylor, this is a true test. While unrealized profits on paper remain solid, the company faces shrinking funding options and a cooling market sentiment.

With both bond market skepticism and profit-taking by long-term holders happening simultaneously, whether the company can continue its accumulation strategy may depend on whether Bitcoin can transition into the next bullish phase before 2026.

Today’s Pre-Market Overview

Source: Google Finance