Bitcoin Proxy Strategy mNAV Falls to New Low, MSTR Stock Plunges 7%

Key Insights:

• Strategy’s mNAV has dropped to a new low of 1.03.
• MSTR stock fell more than 6% to $156.05 on Friday.
• Bitcoin price pared earlier gains and fell below $90K.

Strategy (previously MicroStrategy), the largest corporate Bitcoin treasury, saw its key metric, mNAV, fall to a record low. The MSTR stock price has dropped 6% on Friday.

This happened despite MSCI’s decision not to remove digital asset treasury companies from its index. Bitcoin price has pared earlier gains and tumbled below $90K.

Strategy mNAV Drops to 1.03 amid Heavy Selling Pressure

Strategy’s mNAV, which compares the enterprise value to the market value of its Bitcoin holdings, has tumbled to a new low of 1.03. This has raised more concerns for investors.

According to its MSTR dashboard, Strategy’s enterprise value is $63.93 billion. However, Yahoo Finance and other sources show a lower enterprise value of around $62.27 billion.

The market value of Strategy’s total Bitcoin holdings fluctuates between $61 billion and $62 billion at the time of writing. Earlier this week, MicroStrategy announced BTC purchase worth $116 million, increasing its total holdings to 673,783 BTC.

The mNAV dropped to a record low today amid intense uncertainty and selling pressure on Bitcoin price. Also, the MSCI’s decision to keep MSTR on the index failed to trigger a sharp uptick.

Experts warn that Bitcoin could fall further in the coming days amid headwinds and macroeconomic pressure. Moreover, the Bitcoin treasury firm increased its USD reserves to $2.25 billion. It shows the company is bracing for mNAV drop and crypto market volatility.

MSTR Stock Drops More Than 6%

MSTR stock closed up 7% at $166.97 on Thursday amid buy-the-dip sentiment. However, the stock has dropped more than 6% to $156.05 on Friday. When writing, the intraday low and high were $155.46 and $167.18, respectively. Trading volume is also below the average trading volume of 17 million.

This further decline shows that investors are increasingly uncertain about MicroStrategy’s Bitcoin strategy. MSTR stock is witnessing increased selling pressure amid a rise in options put volume.

Galaxy CEO Mike Novogratz stated that the previous model of hyping stocks to attract investors is over. MSTR stock is down nearly 50% over the past 3 months. It has also dropped almost 70% from its all-time high in July.

The drop follows heavy dilution of its Class A shares. Ongoing share issuances to finance BTC buys and cover dividends on preferred securities have raised concerns among some investors.

MSTR Stock Falls as Bitcoin Price Under Selling Pressure

MicroStrategy executive chairman Michael Saylor remained bullish on MSTR stock and the Bitcoin accumulation strategy. Saylor even hinted at further Bitcoin purchases. However, BTC price remains under pressure, trading within a range-bound pattern near $90K after falling from $94K highs.

Trading volume has also dropped by 10% over the last 24 hours. This indicates a decline in interest among traders amid crypto options expiry today.

CoinGlass data showed mixed sentiment in the derivatives market in the last few hours. At the time of writing, the total BTC futures open interest tumbled more than 3% in the last 24 hours.

The 4-hour BTC futures open interest on CME and Binance climbed almost 2% and 1%, respectively. This pushed 4-hour futures open interest jumped more than 1% to $4.09 billion.