Strategy (MSTR), the largest public holder of bitcoin won’t panic unless BTC sinks to the $8,000-$10,000 range, its CEO has said.
Phong Le identified that interval as when the company “had to consider some of the risk associated with our debt,” in an interview with Bloomberg TV on Tuesday.
Such a drop would represent a drop of around 85% based on bitcoin’s current price of around $64,500 at the time of writing.
“Until then, we feel very confident about the balance,” Le said. “What we need to do is build a capital structure that can withstand bear markets and of course take advantage of bull cycles.”
The strategy’s preferred stock STRC, which is designed to give it the cash flow to fund its bitcoin purchases in return for a regular dividend – currently a 13% annual return – has been under pressure in recent months. The stock is designed to maintain a $100 par, which it lost in April and fell below $75 in late June.
When STRC falls below $100, it limits Strategy’s ability to issue new shares and then use the cash to buy bitcoin.
