Strategy's Bitcoin leverage strategy is under pressure as observers doubt the company's ability to withstand prolonged market volatility.
Jeff Dorman, the Chief Investment Officer at Arca, believes that concerns about Strategy being forced to sell Bitcoin are unfounded. He emphasizes that Michael Saylor's 42% ownership prevents any takeover, that there are no debts with mandatory Bitcoin liquidation clauses, and that the traditional software segment continues to generate positive cash flow, sufficient to cover interest payments.
Dorman also stated that Strategy is no longer a significant buyer of Bitcoin compared to ETF capital flows, but this does not make the company a systemic risk.
The Strategy stock closed at 199.74 USD, down 4.22% on the day and 33.42% year-to-date, while Bitcoin only rose 0.4% during the same period. The current price of Bitcoin is around 94,293 USD, down 1.2% in the last 24 hours.
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Strategy under pressure amid criticism of the Bitcoin leverage strategy
Strategy's Bitcoin leverage strategy is under pressure as observers doubt the company's ability to withstand prolonged market volatility.
Jeff Dorman, the Chief Investment Officer at Arca, believes that concerns about Strategy being forced to sell Bitcoin are unfounded. He emphasizes that Michael Saylor's 42% ownership prevents any takeover, that there are no debts with mandatory Bitcoin liquidation clauses, and that the traditional software segment continues to generate positive cash flow, sufficient to cover interest payments.
Dorman also stated that Strategy is no longer a significant buyer of Bitcoin compared to ETF capital flows, but this does not make the company a systemic risk.
The Strategy stock closed at 199.74 USD, down 4.22% on the day and 33.42% year-to-date, while Bitcoin only rose 0.4% during the same period. The current price of Bitcoin is around 94,293 USD, down 1.2% in the last 24 hours.