Phong Le, the CEO of Strategy, has revealed that while the company remains committed to accumulating Bitcoin, selling some of its holdings may be necessary under specific conditions. Strategy, one of the largest Bitcoin treasury holders, currently owns 649,870 BTC, valued at approximately $58.84 billion. However, Le clarified that the decision to sell Bitcoin would only arise in a scenario where the company’s financial stability is at risk.
Bitcoin Yield as a Key Metric
According to Le, the company’s primary metric for assessing performance is Bitcoin yield, akin to traditional companies focusing on earnings per share. Strategy’s decision to build a large Bitcoin treasury is driven by the belief that it generates significant yield over time.
Despite this, Le acknowledged that if the company’s Market Net Asset Value (MNAV) falls below 1x, selling Bitcoin could become a necessity to meet obligations like dividend payments.
"Selling Bitcoin would only occur if we needed to fund our dividend payments and MNAV drops below 1x," Le stated.
He emphasized that Bitcoin yield serves as the company’s guiding principle, helping steer its decisions. Still, the potential sale of Bitcoin would remain a "last resort," and only pursued in extreme situations where financial sustainability is threatened.
Balancing Narrative and Financial Logic
Though selling Bitcoin could make financial sense in some cases, Le highlighted the narrative challenges that would accompany such a move. As the largest Bitcoin treasury holder, Strategy has built its identity on the notion of "accumulating and holding" Bitcoin, a strategy that has contributed to its market valuation.
A sale of Bitcoin, even if logical from a financial standpoint, could negatively impact this narrative, particularly with retail investors who often focus more on the company’s story rather than its internal financial metrics.
Le also acknowledged that there may be tax benefits in selling Bitcoin at a high cost basis, as it could generate capital losses to offset other gains. However, the challenge lies in aligning this with market perceptions, particularly among institutional investors who expect a more numbers-driven approach. Strategy must balance its internal financial strategy with external expectations to maintain shareholder confidence.
Focus on Bitcoin Accumulation, Not Acquisitions
In terms of acquisitions, Le made it clear that Strategy is not interested in buying other Bitcoin treasury companies. While smaller companies may be available at a discount, Le noted that many are priced low for reasons such as poor management or flawed business models.
With only 10 employees, Strategy does not have the resources to pursue acquisitions that could distract from its primary focus of Bitcoin accumulation.
Le’s comments shed light on Strategy’s cautious approach to managing its vast Bitcoin holdings, signaling that while selling is an option, it remains a distant possibility.