In the midst of crypto turmoil, Cantor Fitzgerald has surprised the market with a significant adjustment to its price target for Strategy (MSTR). The investment bank has drastically lowered its outlook, while simultaneously stating that fears of forced liquidation are exaggerated. This decision raises questions, particularly given Strategy's substantial reliance on Bitcoin. This analysis delves into the reasons behind the downward revision and examines the real risks for investors.
In brief
- •Cantor Fitzgerald reduces its price target for Strategy (MSTR) by 60%, from $560 to $229.
- •Strategy holds $1.44 billion in cash, sufficient to cover its dividends for 21 months, thereby limiting the risks of forced sales of its 650,000 bitcoins.
- •Bitcoin's price remains a decisive factor, influencing MSTR's valuation and the outcome of risks related to potential exclusion from MSCI indices.
Cantor Fitzgerald Halves Its Target for Strategy
Cantor Fitzgerald has made a notable move by lowering its price target for Strategy from $560 to $229, representing a substantial 60% decrease. This is a significant revision, even within the volatile cryptocurrency sector. This adjustment follows a period where Strategy's (MSTR) stock has experienced a 35% decline since the beginning of the year and a 27% drop over the past month. Currently, the company has a market capitalization of $53 billion and holds over 650,000 bitcoins, which are valued at approximately $55.7 billion at current market prices.
The 60% reduction in Cantor Fitzgerald's target for MSTR is partly attributed to the recent decrease in Bitcoin's price, which fell from a high of approximately $126,000 in October to around $86,000 in early December 2025. Adding to these concerns, Strategy faces a significant regulatory risk. MSCI is currently considering the exclusion of companies whose assets are more than 50% invested in cryptocurrencies. Such a decision could potentially trigger forced sales of MSTR holdings amounting to $2.8 billion.
Strategy: Cantor Remains Optimistic Despite Revisions
Despite the drastic revision of its price target, Cantor Fitzgerald maintains an optimistic outlook on Strategy. The bank has highlighted several key strengths that contribute to its positive assessment of the company:
- •The company possesses a substantial cash reserve of $1.44 billion, denominated in fiat currency rather than Bitcoin.
- •Strategy has the capacity to issue new shares as a means of funding, which serves to reduce the immediate risk of forced sales of its Bitcoin holdings.
- •The bank acknowledges Strategy's "leveraged bitcoin beta," indicating that the stock's valuation is heavily influenced by the price movements of Bitcoin.
Furthermore, Cantor Fitzgerald suggests that fears of liquidation would only become a genuine concern in the event of an extreme Bitcoin crash, specifically a drop of 90%. The analysts at the bank deem such a scenario to be unlikely. Additionally, the bank views the recent market correction as a healthy consolidation phase, which is often necessary for sustainable recovery.
Bitcoin's Price Dictates Market Decisions for Strategy
The price of Bitcoin plays a pivotal role in the valuation of stocks like Strategy, serving as a prime example of this interconnectedness. The correlation between Bitcoin (BTC) and MSTR prices is striking; when Bitcoin experiences a downturn, MSTR tends to follow suit. In November 2025, record outflows of $3.6 billion from Bitcoin ETFs exacerbated the decline of MSTR and the broader cryptocurrency sector. This dynamic clearly illustrates the significant influence Bitcoin's performance has on the decisions made by investors and analysts.
Moreover, the decisions of analysts and the composition of indices such as MSCI are directly impacted by Bitcoin's volatility. Consequently, a price recovery for Bitcoin above the $100,000 mark could potentially revitalize MSTR and alleviate regulatory concerns. Conversely, a further decline in Bitcoin's price would intensify the pressure on Strategy and accelerate the possibility of its exclusion from key indices.
Cantor Fitzgerald has conveyed a clear message: while Michael Saylor's company is not facing immediate existential danger, its future remains intrinsically linked to the performance of Bitcoin. Balancing strong liquidity with potential regulatory challenges, Strategy exemplifies the complex dynamics and opportunities present in an evolving cryptocurrency market. The question remains for investors: would you be willing to invest in Strategy despite these prevailing uncertainties?