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JPMorgan: Strategy can maintain the enterprise value to Bitcoin holdings ratio above 1 to avoid forced Bitcoin sales

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On December 4, Strategy, as the largest publicly held Bitcoin company, could impact the price of Bitcoin if it sells part of its holdings. JPMorgan stated that Strategy can avoid forced selling by keeping its enterprise value to Bitcoin holdings ratio above 1.0; currently, the ratio stands at 1.13. If this ratio remains above that level, the Bitcoin market may stabilize, alleviating recent pressure. Due to the downturn in the crypto market, Strategy’s stock price has fallen by about 42% over the past three months, and the company has slowed its pace of Bitcoin purchases—acquiring 9,062 Bitcoins last month compared to 134,480 Bitcoins during the same period a year ago. Additionally, if Strategy is removed from the MSCI Index, it could trigger about $8.8 billion in capital outflows. However, Strategy holds $1.4 billion in reserves from dividends and interest, which should help it avoid forced Bitcoin sales even if Bitcoin prices decline further.

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