• CROX ROAD
  • Posts
  • Why Strategy Keeps Buying Bitcoin Even as MSTR Trades Below NAV

Why Strategy Keeps Buying Bitcoin Even as MSTR Trades Below NAV

Why Strategy continues buying Bitcoin even as MSTR trades below NAV. An in-depth look at Michael Saylor’s long-term thesis, shareholder debate, and capital strategy.

Strategy Inc. continues to accumulate Bitcoin even while its stock, MSTR, trades below the net asset value of its Bitcoin holdings. To traditional investors, this appears counterintuitive. Buying back discounted shares would seemingly create more immediate shareholder value. Yet Michael Saylor and Strategy Inc. remain committed to a Bitcoin-first capital strategy. Understanding why requires separating conventional corporate finance logic from a Bitcoin-native thesis.

Table of Contents

What Trading Below NAV Actually Means

When MSTR trades below NAV, the market values the company at less than the current value of its Bitcoin holdings minus liabilities. In simple terms, investors could theoretically buy exposure to Bitcoin more cheaply through the stock than by buying Bitcoin directly.

Critics argue that this creates a clear incentive for share buybacks. Repurchasing discounted shares would increase Bitcoin per share and immediately benefit remaining shareholders. This logic underpins much of the criticism coming from traditional market commentators.

Peter Schiff’s Critique

One of the most vocal critics is Peter Schiff, who has repeatedly argued that Strategy’s approach violates basic principles of capital allocation. From his perspective, continuing to buy Bitcoin while shares trade below NAV destroys shareholder value and prioritizes ideology over financial discipline.

Schiff’s argument is rooted in classical finance. If assets are undervalued by the market, companies should reduce share count rather than expand balance sheet exposure to volatile assets.

Strategy’s Core Thesis Is Not About NAV

Strategy’s decision-making framework does not treat NAV discounts as a primary signal. The company views them as temporary market inefficiencies rather than structural problems.

From Strategy’s perspective, MSTR is not designed to be a conventional operating company optimizing quarterly equity metrics. It is structured as a long-term Bitcoin accumulation vehicle with an operating business attached. NAV fluctuations are therefore secondary to the primary objective of increasing total Bitcoin holdings over time.

Bitcoin as a Treasury Asset, Not a Trade

At the center of Strategy’s strategy is Bitcoin itself. Saylor has consistently framed Bitcoin as superior monetary property compared to fiat currencies, bonds, or even equities.

Under this view, every opportunity to acquire Bitcoin is valuable regardless of short-term equity pricing. Selling Bitcoin to buy back shares would reduce the company’s core treasury asset in exchange for exposure to market sentiment. Strategy prefers the opposite trade.

Why Strategy Avoids Share Buybacks

There are several reasons Strategy avoids aggressive buybacks even when MSTR trades at a discount.

First, buybacks are irreversible. Bitcoin purchases preserve optionality. Bitcoin can later be used as collateral, liquidity, or strategic leverage.

Second, Strategy sees Bitcoin accumulation as compounding over time. Reducing share count today does not increase the company’s Bitcoin reserves tomorrow.

Third, buybacks implicitly signal that management believes the stock price is the best investment available. Strategy believes Bitcoin itself is the superior asset.

Capital Markets Access Is the Real Advantage

One overlooked factor is Strategy’s access to capital markets. The company has repeatedly demonstrated the ability to raise capital through equity issuance, convertible debt, and structured offerings.

Even when MSTR trades below NAV, Strategy can still leverage market instruments to expand its Bitcoin position. The firm treats market volatility as a feature rather than a bug. Discounts allow long-term believers to accumulate more exposure through equity, while Strategy continues stacking Bitcoin at the treasury level.

MSTR as a Bitcoin Proxy, Not a Value Stock

Many investors misunderstand what MSTR represents. It is not intended to track Bitcoin perfectly on a daily basis. It is a leveraged, managed proxy with embedded operating risk, financing strategy, and long-term conviction.

This distinction explains why Strategy does not manage toward short-term parity with Bitcoin NAV. The company expects periods of premium, discount, and divergence across market cycles.

Long-Term Bet on Monetary Transition

At its core, Strategy’s approach reflects a macro thesis. Saylor believes the global financial system is undergoing a slow transition away from fiat debasement toward hard digital assets.

Under this framework, short-term stock pricing inefficiencies are irrelevant. What matters is maximizing exposure to the asset that Strategy believes will outperform over decades, not quarters.

Conclusion

Strategy keeps buying Bitcoin while MSTR trades below NAV because it is not optimizing for traditional valuation metrics. It is optimizing for long-term Bitcoin accumulation. Critics like Peter Schiff evaluate the strategy through a classical finance lens, while Michael Saylor operates from a monetary transformation thesis.

Whether the approach succeeds ultimately depends on Bitcoin’s role in the future financial system. If Bitcoin fulfills Strategy’s expectations, today’s NAV discounts will appear insignificant in hindsight. If it does not, critics will argue the warning signs were always there.

FAQs

Why does Strategy keep buying Bitcoin when MSTR trades below NAV

Strategy prioritizes long-term Bitcoin accumulation over short-term equity valuation. The company views NAV discounts as temporary market inefficiencies rather than signals to change its core treasury strategy.

What does trading below NAV mean for MSTR investors

It means the market values MSTR at less than the current value of its Bitcoin holdings minus liabilities. Investors are effectively buying Bitcoin exposure at a discount through the stock.

Why not buy back shares instead of buying Bitcoin

Strategy believes Bitcoin offers superior long-term optionality compared to share buybacks. Bitcoin can be used as collateral, liquidity, or strategic leverage, while buybacks permanently reduce flexibility.

Is Michael Saylor ignoring shareholder value

Saylor argues that shareholder value is maximized over time by increasing Bitcoin per share through accumulation, not by managing short-term stock price dynamics.

Does this strategy increase risk

Yes. Concentrating treasury assets in Bitcoin increases volatility and leverage risk. Strategy accepts this risk based on its conviction in Bitcoin’s long-term monetary role.

Sponsored By:

Unlock the power of your Bitcoin with Money On Chain, the Bitcoin-backed DeFi protocol on RSK that issues DOC—a stablecoin pegged 1:1 to USD for rock-solid stability amid volatility, proven through overcollateralization and risk-sharing that survived the 2020 crash without a hitch. Harness BTC's unmatched security and censorship resistance while earning yields up to 20% via leveraged BPro tokens and governing with MoC for rewards and upgrades—all in a trustless, transparent ecosystem. Transform idle BTC into productive assets today: Visit moneyonchain.com and start building!

That's all for today, see ya tomorrow! If you want more, be sure to follow our X (@croxroadnewsco), Instagram (@croxroadnews.co), Youtube (@libertarianbtc), Tiktok (@croxroadnews) and nostr - [email protected]

VISIT OUR STORE

The Best Merch For Bitcoin Maxis

Visit Crox Road Store 👉🏻 https://croxroad.store/

FOLLOW US ON NOSTR

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.

You May Also Like

If You Like Our Content And Want To Help Us To Make It Better, You Can Buy Us One (Or More!) Coffee CLICKING HERE

Reply

or to participate.