A curious divergence is unfolding for Strategy’s equity. As the company aggressively expands its Bitcoin reserves and major financial institutions establish billion-dollar positions, the share price continues its persistent decline. This creates a fundamental puzzle for the market: are the selling shareholders correct, or is the wave of institutional money making the right long-term bet?
Unwavering Accumulation Amid Share Price Pressure
Despite significant downward pressure on its stock, Strategy remains committed to its primary objective of accumulating Bitcoin. The company recently announced the acquisition of an additional 850 BTC, valued at approximately $100 million. This purchase was funded through a share issuance—a move that bolsters the company’s crypto assets but simultaneously dilutes the ownership of existing shareholders. Strategy’s total holdings now exceed 639,835 BTC.
This steadfast approach to building its digital treasury stands in stark contrast to the performance of its shares, which have trended downward.
Deepening Losses and Market Skepticism
The bearish trend for Strategy’s stock is unmistakable. Shares have plunged to a five-month low, and the company’s market capitalization has eroded by a substantial $8 billion this quarter alone. Analysts note that the stock’s decline has been more pronounced than that of Bitcoin itself, suggesting that the market is expressing specific doubts about Strategy’s capital allocation strategy, independent of broader crypto market movements.
Should investors sell immediately? Or is it worth buying Strategy?
Institutional Giants Place Their Bets
In a striking counter-narrative to the falling share price, some of the world’s largest financial institutions are increasing their exposure to Strategy. This significant institutional accumulation presents a strong vote of confidence in the company’s long-term valuation.
Key recent investments include:
* A $31.6 million stake acquisition this month by Northern Trust.
* Year-to-date purchases exceeding $300 million in Strategy shares by Amundi.
* A massive existing position of over $1.1 billion held by Norway’s Sovereign Wealth Fund.
* Combined investments of more than $40 million from US pension funds CalSTRS and CalPERS.
Insider Activity Adds to the Puzzle
Complicating the picture further are transactions by company insiders. The sale of $10 million in shares by CFO Andrew Kang in August, officially for personal financial planning reasons, has drawn attention. Markets often scrutinize such insider sales for clues about executive sentiment, adding another layer of complexity to the current situation.
The central question remains unresolved. Will the substantial institutional backing eventually reverse the stock’s fortunes, or will the negative momentum persist despite these high-profile endorsements? The market awaits a clear signal.
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