Bitcoin Reserve Strategy Pioneer MicroStrategy (originally MicroStrategy) claims that even if Bitcoin’s price drops to 8K, the company still has enough assets to fully repay MicroStrategy’s debt. Founder Michael Saylor states that the company plans to convert the convertible bonds into equity within the next 3 to 6 years.
Even if Bitcoin drops to 8K, MicroStrategy can still repay all its debt
According to information on MicroStrategy’s official website, Strategy’s current net debt is approximately $6 billion, based on its Cum Notional, which reflects the “priority of debt repayment” and “net debt after cash buffers.” Its logic includes three levels:
The nominal value of the debt itself
Tools arranged by shorter remaining maturity (i.e., earlier due date) or higher debt seniority
Finally, subtract its USD Reserve, currently $2.25 billion
Using this logic, Strategy’s current net debt is $5.964 billion, and its holdings of 714,644 Bitcoin can withstand Bitcoin dropping to $8,345, allowing it to repay its current convertible debt.
Convertible bonds to be converted into equity within 3 to 6 years
Looking at MicroStrategy’s current convertible bonds, they mature between 2028 and 2032, with conversion prices ranging from $183 to $672. Compared to MSTR’s current stock price of $133, there is still a gap. However, if the stock price does not reach the conversion price at that time, the company will repay the principal at nominal value. From the company’s perspective, it seems more inclined to convert debt into equity to reduce cash flow pressure.
This is also the goal of founder Michael Saylor: to convert convertible bonds into equity within the next 3 to 6 years.
This article: Bitcoin drops to 8K, MicroStrategy can still repay all debts! Why does Saylor have the confidence to say this? Originally published on Chain News ABMedia.
Disclaimer: The information on this page may come from third parties and does not represent the views or opinions of Gate. The content displayed on this page is for reference only and does not constitute any financial, investment, or legal advice. Gate does not guarantee the accuracy or completeness of the information and shall not be liable for any losses arising from the use of this information. Virtual asset investments carry high risks and are subject to significant price volatility. You may lose all of your invested principal. Please fully understand the relevant risks and make prudent decisions based on your own financial situation and risk tolerance. For details, please refer to
Disclaimer.
Related Articles
Bitcoin inflows to exchanges reach a new high, with $75,000 becoming a key resistance level
As the crypto market rebounds, on-chain capital inflows to Bitcoin have significantly increased, reaching the highest levels, indicating the market may face selling pressure. Meanwhile, prices are approaching short-term resistance zones, and macro interest rate policies remain a key factor. Market expectations for rate cuts have cooled, which could constrain risk assets.
GateNews20m ago
Grayscale Research Head Points to XRP Being Undervalued, Valuations Expected to Correct Rapidly After Regulatory Clarity
Grayscale Research Head Zach Pandl pointed out that XRP's market price does not reflect its actual utility, primarily due to regulatory uncertainty affecting its valuation. Once the CLARITY Act establishes clear cryptocurrency asset regulations, XRP is expected to be repriced. Additionally, growing market demand for the GXRP Trust product shows that institutional investors are positioning early, anticipating market opportunities following regulatory clarity.
MarketWhisper47m ago
TRUMP Coin Holders Rush to Trump's Mar-a-Lago Luncheon! Analysts: Beware of Post-Hype Pullback
Trump will host a luncheon on April 25th at his Mar-a-Lago estate in Florida, inviting top TRUMP token holders, causing the token's price to surge. The hype pattern before the event indicates that the token may decline after the event, with historical data supporting this view. Additionally, Congress is reviewing three bills to restrict politicians from profiting through meme coins, but they have not yet entered the voting stage.
MarketWhisper53m ago
Bitcoin dips back below $75,000 on the eve of the Federal Reserve decision
Bitcoin recently touched $75,000 but failed to sustain the level, pulling back to $74,000, reflecting cautious sentiment among investors ahead of the upcoming Federal Reserve interest rate decision. Geopolitical risks and elevated energy prices have driven inflation higher, affecting market expectations for rate cuts and pushing the timeline for cuts to year-end. Technical analysis shows Bitcoin remains strong but has not confirmed a decisive breakout above the $75,000 level, with limited upside potential in the near term.
区块客1h ago
XRP Today’s News: SEC Declares "Commodity" Not a Security, Exchange Orders Send Strong Buy Signal
On March 18, the SEC Chair announced that XRP was classified as a "digital commodity," ending regulatory uncertainty. On the same day, Coinbase displayed an XRP spot order book reaching a 9:1 buy-to-sell ratio, the strongest buyer signal. This development reduced compliance risks for holders, boosted institutional confidence, and paved the way for future financial product applications.
MarketWhisper1h ago
Uptrend Encountering Resistance? Analysis: Bitcoin Rebound May Face Headwinds Between $75,000 and $85,000
Bitcoin is currently around $74,611, facing resistance near the $75,000 level, with $85,000 being a larger resistance zone. Despite bullish signals appearing in the derivatives market and a short-term uptick in risk appetite, the increase in Bitcoin flowing into exchanges may bring profit-taking pressure. Market focus is concentrated on the Federal Reserve's interest rate decision, and if the results fall short of expectations, it will affect the sustainability of Bitcoin's rebound.
区块客1h ago
