Is MicroStrategy About to Sell Bitcoin?

📉 The Cryptocurrency Market Situation

If you’ve been watching the market, you can feel it. Buying pressure is weak across crypto. Rallies fade quickly, order books look thin, and buyers are hesitant to step in. The confidence is clearly fading.

By the end of November, Bitcoin $BTC ( ▼ 0.88% ) was down 18.96%. That drop didn’t come with a major shock or bad headline. It happened quietly, which is often more concerning.

The situation is worse for altcoins. Ethereum $ETH ( ▼ 0.28% ) has now posted three straight red months in September, October, and November, with a combined decline of 45.88%.

A big driver here is year-end selling pressure. Investors are locking in profits, funds are rebalancing, and many prefer starting the new year with lower risk rather than holding through uncertainty.

This weak backdrop is important. Any discussion around financial concerns at MicroStrategy Inc $MSTRX ( ▼ 2.26% ) is happening in a fragile market, where liquidity is thin and forced actions can amplify downside quickly.

💣 The Possibility of MicroStrategy Inc Selling Bitcoin

Market anxiety really spiked after management confirmed something many investors didn’t want to hear.

In a severe stress scenario, MicroStrategy may sell part of its Bitcoin holdings. That single statement was enough to shake confidence, especially in a market already struggling with weak demand.

CEO Phong Le was clear. If financial conditions become extreme, the company could sell a portion of its 649,870 BTC to protect shareholders.

This directly contradicts what many people believed that the chairman of MicroStrategy, Michael Saylor, built his reputation around the idea of 'never sell Bitcoin.

Importantly, selling Bitcoin is not a casual option. Management outlined two conditions that must happen at the same time:

• First, MicroStrategy’s market value must fall below the value of the Bitcoin it holds, meaning NAV drops below 1.

• Second, the company must be unable to raise capital through stock issuance or debt to cover interest or dividends.

If both conditions are met, selling Bitcoin becomes a last-resort move, and that’s the real concern. Forced selling at the worst possible moment would only add pressure to Bitcoin’s price.

That’s why many traders view MicroStrategy stock as a leveraged Bitcoin ETF. When Bitcoin rises, the upside is amplified. But when stress hits, downside risks grow faster too. In the current environment, those financial concerns are no longer theoretical. They’re part of the market’s real risk calculation.

🧯 Reassuring Response from Michael Saylor

After the market reacted sharply, Michael Saylor and CEO Phong Le moved fast. They held what felt like an emergency shareholder-style meeting, aimed squarely at calming investors and reframing the narrative around selling Bitcoin.

Saylor didn’t deny the concern and he confirmed that Phong Le’s statement was accurate.

Yes, selling Bitcoin to meet debt or dividend obligations is possible. But he was clear on one thing that option is not the default, and it is not the only tool available. The message was simple: Selling BTC is a last resort, not a strategy.

To reinforce that point, the company revealed a $1.44 billion reserve fund. This buffer is designed to cover dividends and interest payments for at least two months without touching Bitcoin.

More importantly, management plans to scale this reserve to cover 24 months, giving MicroStrategy enough runway to survive short-term volatility. That timeline strongly suggests they are still leaning on Bitcoin’s historical four-year cycle.

Saylor also highlighted alternative liquidity solutions. Instead of selling spot Bitcoin, MicroStrategy could generate cash by using Bitcoin-related derivatives or options. This approach preserves long-term exposure while providing short-term flexibility.

The long-term message stayed consistent. The company’s goal is still to end each quarter holding more Bitcoin than it started with. Even if liquidity pressure ever forces a sale, management insists they would buy back Bitcoin once conditions improve.

As of June, MicroStrategy Inc carries roughly $8.21 billion in total debt. Against that, the company holds about 649,870 BTC, roughly 3.1% of total Bitcoin supply, valued around $59 billion at recent prices. That gap is why Saylor keeps framing this as a liquidity issue, not a solvency one.

Still, reassurance only works to a point.

However, shortly after, MicroStrategy increased its USD reserves by $748 million and now holds a total of $2.19 billion. This somewhat reassured investors.

Previously, the company had $1.4 billion in cash, enough to cover approximately 21 months of interest and dividends. With this additional reserve, if the spending rate remains the same, the current amount could last for about 33 months, nearly three years.

🧨 Other Threats You’re Probably Underestimating

While most investors focus on whether MicroStrategy Inc might sell Bitcoin, there’s another risk that could be far more destabilizing, which comes from traditional finance.

Morgan Stanley $MS ( ▲ 1.57% ) has floated a proposal suggesting that the MSCI index should consider removing companies that hold more than 50% of their balance sheet in cryptocurrency assets. This proposal is driven by growing financial concerns that such firms no longer behave like operating companies and start to resemble investment funds.

If MSCI adopts this framework, around 38 major companies could be affected and MicroStrategy Inc sits at the very center of that list.

The real danger is forced selling.

If MicroStrategy were removed from the MSCI index, any ETFs or index-tracking funds tied to MSCI would be required to sell their shares, regardless of fundamentals or long-term conviction.

That kind of pressure can hit fast and hard leading to liquidity disappearing, spreads widening, and price drops feeding on themselves. In a fragile market already plagued by financial concerns, this type of forced selling could be far more damaging than a voluntary Bitcoin sale.

This is why some investors argue that MSCI exclusion risk is actually more dangerous than a potential Bitcoin sale.

In a fragile environment already defined by financial concerns, this threat deserves far more attention than it’s currently getting.

⚠ This newsletter is for informational purposes only and should not be considered investment advice. Traders should conduct thorough research, understand the risks, and carefully evaluate their decisions before investing in cryptocurrency.

If you’re interested in other topics and want to stay ahead of how Crypto is reshaping the markets, from whale strategies to the next major altcoin narrative, you can explore more of our deep-dive articles here:

• Macro Environment: The AI Race is Hotter*

• The Crypto Sell-Off and Get Ready for the Old Coins

• Latest Crypto News: Bitcoin Reawakens, TAO Halving Hype Builds

• AI in Trading: How ChatGPT Atlas Could Redefine Trading Strategy*

• Zcash Pumps 30%, and Bitcoin Prepares for a Breakout

*indicates premium insights available to Pro readers only.