2026-01-02 10:21:41

The biggest variable in this year's market performance is probably the performance of MicroStrategy, the Bitcoin-related stock. MSTR experienced nearly a 50% decline throughout 2025. As a "leverage proxy" for Bitcoin, its stock price volatility far exceeds that of Bitcoin itself, making the risk premium obvious.

The turning point came with a proposal from MSCI. The index provider suggested removing companies with digital asset holdings exceeding 50% from the index, arguing that they are no longer traditional operating companies but more like investment institutions. The problem is, MicroStrategy's Bitcoin holdings account for as much as 77%-81%, well over the threshold.

On the surface, the index adjustment mainly impacts passive funds. As long as there is no liquidity crisis or break in the financing chain, the company will not be forced to sell its Bitcoin. But in the long run, this will be a heavy blow to companies like "Bitcoin Treasury" that rely on financing.

MicroStrategy's approach is to continuously raise funds through targeted offerings (ATM financing) and convertible bonds to buy Bitcoin. The premise of this leverage flywheel is maintaining an attractive stock price. Once kicked out of major indices, a sharp drop in stock price and a sudden contraction of valuation premiums could cause this financing model to falter, rapidly depleting its financing capacity.

What’s more painful is that if passive fund withdrawals cause significant stock price volatility (estimated outflows between $2.8 billion and $8.8 billion), combined with the overall sluggishness of the crypto market, the company could approach the warning line for debt repayment or pledge agreements. At that point, reducing Bitcoin holdings will no longer be an option but a forced emergency measure—Saylor has said that selling Bitcoin is the last resort.

MSCI is expected to officially announce the final decision on January 15, 2026. This market adjustment could become a key turning point in the entire cycle.

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ChainWanderingPoet

· 11h ago

Saylor is really gambling with his life this time. Once the leverage flywheel stalls, it's a domino effect. Outflows of $2.8 billion to $8.8 billion? That's a life-threatening pace. The MSTR financing model is essentially a game of hot potato; the stock price is its lifeline. Once the index kicks it out... I want to see how Saylor explains why he's selling coins. A 50% drop isn't over yet. When MSCI makes a final decision, it might be the real meat grinder. The Bitcoin treasury concept was inherently fragile; adding leverage is a ticking time bomb. Now, it's really about who can survive until 2026.

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LiquidationWizard

· 12h ago

Saylor's sword is hanging over his head. Once the financing flywheel breaks, he will have to sell coins, and then the coin price will also crash. The leveraged play in mstr has long been a ticking time bomb; the index adjustment is just the fuse. In the end, it still depends on whether BTC can perform well or not. Otherwise, a $28 to $88 billion dump is all talk. It's a gambler's mentality, thinking that if the index can't kick out, then it's fine... Wrong. That 50% decline is not even a high point; once the index rules change, the real bloodbath will begin.

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ContractFreelancer

· 12h ago

Oh no, MSTR's leverage play really has a sword hanging over its head. Once kicked out of the index, it's game over. If the financing ability is exhausted, how can they continue buying coins? The flywheel can't spin anymore. If Saylor is really forced to sell coins, the price could drop to a new low, which is terrifying. On January 15th, we probably need to watch out for liquidation warnings; I can't sleep. Basically, it's a leverage game played to the end, and an index adjustment is the fuse.

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RugResistant

· 12h ago

tbh this MSCI thing is a straight up red flag i wasn't expecting... 77-81% bitcoin allocation basically screaming "we're not a real business anymore" lmao

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RegenRestorer

· 12h ago

Saylor's hand is really tough to play right now. Once the leverage flywheel stops, it's all over. Selling coins is truly the last line of defense. I can already imagine the scene of being forced to dump. MSCI's move was too precise; toe the line and you're out. It's really a bit desperate. Outflows from $28 billion to $88 billion... Just thinking about it is a bit terrifying. If this wave collapses, the entire ecosystem will tremble. Financing costs have skyrocketed, and stock prices will fall again. Who dares to take over? Instead of waiting for January 15th, it's better to think about an exit strategy now. Anyway, Saylor is betting on the coin price. If the coin doesn't rise, everything is pointless. This could really be a watershed moment in the cycle. Choosing the wrong side means GG.

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BlockBargainHunter

· 12h ago

Saylor really went all in, once he's kicked out of the index, it's basically a dead end. Holding 77% of Bitcoin is way too heavy, isn't this just a naked message to MSCI: "Come and mess with me"? Once the financing chain breaks, the leverage flywheel will instantly reverse, and selling coins will be forced... This round is a bit risky. Outflows from 2.8 billion to 8.8 billion can easily crash the stock price just by thinking about it. The decision on January 15th feels like a time bomb; the crypto market will have to follow and suffer again. After the financing model collapses, what can MSTR do? Just hoard coins and wait to die. This logic has actually been there all along; MSCI is just the one tearing the paper.

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