Strategy CEO Detailed Explanation of Coin Selling Decisions: Great Companies Go Through Near-Death Experiences

Author: Coinage, compiled by Wu Shuo Blockchain

Market Reaction and Long-Term Logic: In the short term, it’s a voting machine; in the long term, it’s a weighing machine

Zack Guzman: This latest action of selling 32 Bitcoins has drawn global attention. Given the various reactions from the market, what is the one point you most want to clarify?

Phong Le: There’s an old saying on Wall Street: “In the short term, the market is a voting machine; in the long term, it’s a weighing machine.” We’re not trying to get people to “vote on how we increase Bitcoin holdings per share”; we’re simply being transparent by providing KPIs and a long-term perspective. There will always be short-term overreactions, but I won’t spend too much time refreshing every comment on X (Twitter). Our decision-making incorporates daily, annual, and long-term views, and it’s the long-term view that matters most.

What we care about is whether we continue to create value for different categories of shareholders—common shareholders, preferred shareholders, debt holders, and others—while also driving the development of the Bitcoin ecosystem itself. This isn’t even the first time we’ve sold Bitcoin. In 2022, we sold about $2.5 million worth of Bitcoin and then bought it back later. This time, we also sold 32 Bitcoins (about $2.5 million). We bought about $100 million the week before last, and about $1.5 billion the week before that. We voluntarily disclose this information every week through 8-K filings. As the world’s largest corporate holder of Bitcoin, absorbing both positive and negative market feedback is part of our responsibility behind transparency.

Proving Liquidity to the Market: Dispelling the “Death Spiral” Narrative

Zack Guzman: Some people view this sale as “vaccinating” the market. Others compare you to Terra, worrying that STRC (Strategy Preferred Stock, i.e., the preferred-stock product Stretch) could be leveraged by other DeFi protocols, potentially triggering a cascading selloff “death spiral.” Is that the concern you heard before making the sale?

Phong Le: That’s not a driving factor at all. We aren’t worried that DeFi protocols built on STRC will trigger a cascading collapse, because about 80% of STRC is held by retail investors, and a significant portion is held long-term by institutions. The share held by DeFi protocols is very small—less than 10%.

When we say “vaccinate the market,” it has two main meanings. First, our debt holders (digital credit and bondholders) want to confirm that, given that nearly 100% of our assets are Bitcoin, if dividends or other payments are truly needed, we have the ability and willingness to use those assets. At the same time, rating agencies want to see that we won’t arbitrarily sell Bitcoin. So we make a small sale to prove to creditors that we can sell, and to prove to rating agencies that we’re disciplined. Second, it’s about testing our internal business processes. We disclosed information about the custodian, but didn’t publish specific Bitcoin addresses. Once we move Bitcoin from cold storage to hot wallets, countless people will be watching and trying to guess which wallets are ours. We want to see how the entire selling process works in a real environment, and how the market reacts. We hope that when we sell a few million dollars’ worth of Bitcoin in the future, the market won’t make a big fuss.

Say Goodbye to the Black Box: Michael Saylor and Strategy’s Decision Mechanism

Zack Guzman: We’ve seen all kinds of experiments in the crypto space; honestly, we’ve also reported on highly power-concentrated founders like SBF and Do Kwon. But Strategy is different. For decisions like “selling 32 Bitcoins,” how exactly is the internal call made?

Phong Le: As a well-known Nasdaq-listed public company, Michael Saylor no longer holds a majority of the equity. We have 8 board members, with common stock, preferred stock, and debt holders—and in a sense, we also bear responsibility to the broader crypto community.

At the macro level, every quarter we discuss the “optionality” of funds—at earnings calls and with the board. That includes whether to issue stock, preferred stock, convertible bonds; whether to buy and sell Bitcoin; or whether to repurchase bonds. Only after consensus is reached at this level does it move into the execution layer. At the micro level, every month we run extremely complex financial models that analyze how different actions affect stock quality and credit quality. Every week, Michael and I discuss the goals for that week; every morning, we coordinate with the capital team, investor relations team, and traders to determine the instructions for that day. We even use Grok sentiment analysis on X, website traffic, and Strategy App usage data to support decision-making. This is absolutely not a “seat-of-the-pants” decision, but the kind of rigor a data-driven company should have.

Fundraising Mechanisms and the Highest-Level Philosophy: “Doing Nothing”

Zack Guzman: Besides Bitcoin, if STRC continues to trade below par value, what other fundraising mechanisms would you use in the future?

Phong Le: We have many options: issuing more stock (our daily trading volume is $2.7 billion, making it one of the most liquid stocks globally), issuing other preferred stock, or issuing more convertible debt—and the market is very receptive to us. But I want to emphasize one point: we currently hold 845,000 Bitcoins, and we can choose “doing nothing.” This was our core strategy during the 2022 bear market—after repaying some senior secured notes and Bitcoin-backed debt, we simply sat quietly on this massive Bitcoin treasury. As Bitcoin rebounds, the company’s valuation and the amount of Bitcoin holdings per share naturally rise. In a bear market, the most dangerous temptation is often to feel like you have to “do something,” such as large-scale panic selling—but we will never do that. “Doing nothing” is one of our extremely important strategic options.

Facing Volatility and Conviction: Great Companies Have All Had “Near-Death Experiences”

Zack Guzman: When you choose “doing nothing” and watch unrealized losses accumulate to billions of dollars, what’s it like personally?

Phong Le: People sometimes forget that this company—once known as MicroStrategy—was founded by Michael Saylor in 1989, went public in 1998, and only added Bitcoin to its balance sheet in 2020. Over the 31 years from 1989 to 2020, our Executive Chairman has led the company through countless ups and downs—that’s precisely the foundation of the company’s resilience and strength. I’ve been CFO since 2015 and CEO since 2022, so I’ve also gone through 11 years of storms. Michael’s hair has turned a lot whiter, and so has mine.

Look at Amazon: if it hadn’t gone through a few near-death experiences and bouts of intense volatility, it wouldn’t be the Amazon we know today. Even Tesla had the “funds secured” tweet controversy. 2022 was indeed a difficult period, but it forged resilience in those who stuck it out. Why am I unwavering? Because I believe in the underlying logic. I believe Bitcoin can create sovereignty and freedom for people worldwide; that it’s a superior way to circulate funds through digital rails; and that it’s an inherently scarce asset with a better design at the algorithmic level. Just like Jeff Bezos believed Amazon could create real value for hundreds of millions of consumers—once you believe in the underlying logic, all other fluctuations will resolve themselves.

The Evolution of AI: From the Founding of STRC to Mars Trading with 60 Trillion Intelligent Agents

Zack Guzman: Rumor has it that STRC product inspiration came from internal exploration of AI tools. What long-term plans do you still have for combining AI and finance?

Phong Le: Yes. When generative AI first emerged, everyone thought it could only write meeting minutes. But we found that it can help us design revolutionary products that would otherwise take months—and might even be rejected outright by lawyers and banks. AI helped us identify applicable case law and financial KPIs, shortening STRC’s development cycle from three years to eight months.

But that’s only the beginning. Even more exciting is agentic AI. Internally, we’re deploying agents to automatically summarize information, repair code (self-healing code), and more. Ultimately, the world will evolve from 6 billion humans into 60 trillion agents that make automatic decisions—imagine SpaceX deploying one million humanoid robots on Mars and the Moon. When they carry out commercial interactions and value exchanges, they will absolutely not use traditional financial networks like Visa, Mastercard, or SWIFT. Instead, they will use decentralized crypto rails and seek high-yield products with Bitcoin as the underlying value storage asset. This is an immeasurably positive development for the crypto world and for Bitcoin.

Break the Separation: Crypto Fundamentalism vs. Capital Markets

Zack Guzman: The crypto world has long felt a sense of split. One camp is the “fundamentalists” who only believe in Bitcoin; the other understands that we must connect to traditional capital markets. How does Strategy balance these two?

Phong Le: When I got deeply involved with Bitcoin, I wanted to promote it to everyone around me. But I never asked them to pass IQ tests or loyalty tests, and I never asked about their religion, nationality, sexual orientation, or professional background. If Bitcoin is going to win the world, it has to give as many people as possible exposure in a variety of ways. Whether through self-custody on hardware wallets, buying on Coinbase, holding Strategy stock, holding STRC, or through DeFi protocols and ETFs—these are all good ways to spread Bitcoin. Our philosophy is: “Spread Bitcoin with love.”

Can STRC Return to $100 Par Value?

Zack Guzman: Will STRC compete in the stablecoin market with USDC/USDT? What do you think its roadmap is for returning to $100 par value?

Phong Le: STRC was created only 10 months ago, while Bitcoin is already 18 years old—it’s still in its infancy, and we’re still learning and improving. Our goal is to keep it trading between $99 and $101. Recently, we used dollar reserves to repurchase $1.5 billion in convertible bonds, which reduced reserves and temporarily put pressure on the STRC price. Next, we will replenish reserves, and with the first semiannual interest payment mechanism starting June 30, it will gradually return to par value. The product is extremely over-collateralized, paying dividends is not an issue, and it wouldn’t keep me up at night.

Polymarket Controversy Finally Resolved

Zack Guzman: The massive controversy on Polymarket about whether you sold Bitcoin before May 31—did you really sell?

Phong Le: I followed the entire process closely. The statement I can make clearly is that in the week before May 31, we indeed sold Bitcoin, and this was accurately recorded in the 8-K filing released on the following Monday morning at 8 a.m. As for how prediction markets interpret the contract, that’s their business, but I’m very clear about what the company actually did internally.