What is Strategy?

Strategy $MSTR is the first and largest bitcoin treasury company. Strategy was founded by Michael Saylor in 1989, originally as a software company that sold business intelligence tools. It quickly grew after going public under the name MicroStrategy, but then in early 2025 changed its name to Strategy.

Due to its rapid success, the company accumulated massive amounts of cash on its balance sheet, creating a significant risk that inflation would diminish its value. In 2020, Sayor initiated its first purchase of bitcoin as a hedge against this economic uncertainty. Following a $250 million purchase in BTC, the company adopted bitcoin as its primary treasury reserve asset, reinventing the company entirely around accumulating BTC.

Between 2020 and 2024, Strategy’s stock surged by more than 2,000%, right alongside Bitcoin’s rise. However, as bitcoin tumbled, it has taken Strategy along for the ride. Its shares are down 65% from the beginning of 2025. Despite the ups and downs, Saylor has remained a bitcoin bull. In February 2025, amidst a fall in BTC stock price, Saylor posted on Twitter, “Sell a kidney if you must, but keep the Bitcoin.”  

Strategy currently owns about 850,000 BTC with a portfolio value of over $53 billion, as of June 11, 2026. 

Business Model

After purchasing bitcoin in 2020, Saylor quickly realized that it was massively undervalued relative to what capital markets would pay to gain exposure to it, and he wanted to take advantage of that. He utilized Strategy as a bridge, taking cheap institutional capital from equity issuance, convertible bonds, and preferred stock, and turning it into bitcoin.

In 2025, MSTR’s bitcoin yield—how much bitcoin per diluted share grew—was 22.8%, meaning that shareholders owned 22.8% more bitcoin per share than they did at the start of the year. 

When working smoothly, Strategy’s business model incentivizes institutions to keep buying stocks and bonds, because investors get leveraged bitcoin exposure via a regulated stock.

1. Equity Issuance. When Strategy’s shares trade at a premium, it issues new shares at that higher price and uses cash from that to buy more bitcoin. Existing shareholders don’t really care about the dilution because their bitcoin-owned per share goes up more.  However, when shares trade below NAV, Strategy’s stock is priced at a discount, and issuing new shares no longer makes sense. During times like that, Strategy considers issuing credit instruments to repurchase shares, which is theoretically supposed to boost share value. 
2. Convertible bonds. Strategy also utilizes convertible bonds as a funding strategy. While the convertible bonds offer little to no interest rates, investors still find them attractive because they get the option to convert these bonds into Strategy’s stock. This enables investors who are apprehensive about BTC’s volatility to participate in BTC’s upside without directly owning the asset. Strategy, in turn, uses the money raised from these bonds to buy more bitcoin. If bitcoin rises, Strategy’s profits rise, and because of the low interest rate on the convertible bonds, their debt is cheap and almost negligible. 
3. Other ways. The newest layer of Strategy’s funding strategy is its issuance of preferred shares, which attracts investors who desire a higher yield compared to purchasing the company’s convertible bonds. Their preferred stock ($STRC, $STRK, $STRF) are cheaper than issuing debt. This method broadens Strategy’s capital base, is less dilutive than common stock, and gives the company flexibility over issuing dividends. Investors also theoretically benefit because they have multiple vehicles to invest in MSTR based on their risk tolerance.