By Lin Wanwan

MSTR (Strategy) holders may be having a hard time sleeping lately.

Once hailed as the "Bitcoin Central Bank," this stock has endured a bloodbath. As Bitcoin rapidly retraced from its all-time high of $120,000, MSTR’s share price and market cap have shrunk dramatically in a short span—plunging over 60%—and Strategy may even face delisting from the MSCI equity index.

Price corrections and a halved stock are merely surface symptoms. What truly has Wall Street on edge is mounting evidence that MSTR is entangled in a battle for monetary power.

This is no exaggeration.

Over recent months, seemingly unrelated events have begun to converge: JPMorgan being accused of aggressively increasing short positions against MSTR; delays in settlement when users attempt to withdraw MSTR shares from JPM; frequent suppression actions in derivatives markets targeting Bitcoin; and a sudden surge in policy discussions around "Treasury-backed stablecoins" and the "Bitcoin reserve model."

These are not isolated incidents.

MSTR stands at the fault line between two competing American monetary systems.

On one side: the old order—Federal Reserve + Wall Street + commercial banking (centered on JPMorgan); on the other: an emerging new system—Treasury + stablecoin infrastructure + a financial architecture anchored by Bitcoin as long-term collateral.

In this structural conflict, Bitcoin is not the target—it is the battleground. And MSTR is the pivotal bridge: it converts traditional institutional dollar and debt structures into Bitcoin exposure.

If the new system prevails, MSTR becomes the core intermediary; if the old system holds firm, MSTR must be suppressed as a critical node.

Thus, MSTR’s recent plunge is not merely asset volatility—it results from the convergence of three forces: natural correction in Bitcoin prices; inherent fragility in MSTR’s risk structure; and spillover conflict triggered by internal power shifts within the U.S. dollar system.

Bitcoin strengthens the Treasury’s future monetary architecture while weakening the Federal Reserve’s framework. Governments now face a difficult choice: to maintain low-price accumulation opportunities, they must allow JPMorgan to continue suppressing Bitcoin.

The campaign against MSTR is systematic. JPMorgan understands these rules intimately—they helped write them. They’ve placed MSTR on the operating table, dissecting its veins (cash flows), skeleton (debt structure), and soul (market faith) with surgical precision.

We now unpack four potential "death poses" for MSTR—four meticulously crafted death warrants prepared by the old order.

Pose One: Exploiting Chaos

This is the most direct and widely discussed scenario: if BTC continues to plummet, MSTR’s leverage amplifies losses, its stock keeps falling, eroding its refinancing capacity, ultimately triggering a chain reaction collapse.

The logic is straightforward—but not the core issue.

While everyone knows “if BTC drops too much, MSTR will fail,” few grasp: exactly how low must BTC fall before MSTR transitions from “rock-solid” to “unstable”?

MSTR’s balance sheet hinges on three key figures:

Over 650,000 BTC holdings (approximately 3% of total Bitcoin supply)

Average cost basis around $74,400

Some debt carries embedded price risk (not margin calls, but impacting net worth)

Many doomsday narratives depict MSTR collapsing like a futures exchange liquidation—but in reality: MSTR has no margin call price, only a “narrative margin call” price.

What does that mean?

Even if creditors don’t force a liquidation, the market will. When the stock hits a certain level, MSTR loses its ability to issue new debt or convertible bonds to replenish its position.

JPMorgan and the old guard are colluding through the U.S. options market to short MSTR. Their tactic is simple: exploit the Bitcoin correction to flood the market with sell orders, inciting panic. Their sole objective? To shatter Michael Saylor’s myth.

This is MSTR’s first trigger point: Bitcoin price drops to a level where external funding dries up.

Pose Two: Debt Enforcement

Before discussing convertibles, we must first understand the mechanics behind CEO Michael Saylor’s “magic trick.”

Many newcomers assume MSTR simply uses profits to buy Bitcoin—wrong. MSTR plays a highly aggressive “leverage arbitrage game.”

Saylor’s core strategy: issue convertible notes, borrow dollars, and buy Bitcoin.

MSTR has raised $20.8 billion in capital this year—a scale rare among U.S. public companies. The funding sources include common stock ($11.9B), preferred stock ($6.9B), and convertible debt ($2B).

This sounds ordinary—but the devil is in the details.

These bonds carry extremely low interest (some under 1%), yet investors still buy them because each includes a “call option.” If MSTR’s stock rises, bondholders can convert debt into equity and profit handsomely; if the stock doesn’t rise, MSTR repays principal and interest at maturity.

This is the famed “flywheel”: issue debt → buy Bitcoin → Bitcoin appreciates → MSTR stock soars → bondholders rejoice → stock premium enables new debt issuance → buy more Bitcoin.

This is the so-called “upward spiral.” But wherever there’s upward spiraling, there’s inevitably a death spiral.

This failure mode is known as “forced deleveraging under liquidity drought.”

Imagine a future year when Bitcoin enters a prolonged consolidation phase (no crash needed—just stagnation). At maturity, old bonds come due. Bondholders see: MSTR’s stock price has fallen below the conversion price.

Bondholders aren’t charities—they’re Wall Street vampires. They won’t convert debt into equity. Instead, they coldly demand: “Pay cash. Now.”

Does MSTR have cash? No. All its cash has been converted into Bitcoin.

Now MSTR faces a desperate choice: either issue new debt to repay old debt. But with low Bitcoin prices and poor market sentiment, new bond yields will skyrocket—devouring whatever meager software business cash flow remains.

Or, sell Bitcoin to repay debt.

If MSTR is forced to announce “selling Bitcoin to repay debt,” it’s like launching a nuclear bomb into the market.

Market panic sets in: “The true believers are surrendering!” Panic triggers Bitcoin sell-off, which drives MSTR’s stock lower, which prevents further conversions, which forces more bondholders to demand repayment.

This is the “Soros-style” kill shot.

This failure mode is the most dangerous—not because it requires a Bitcoin crash, but because it only needs time. When debt maturity coincides with market stagnation, the sound of a broken funding chain will be sharper than breaking glass.

Pose Three: Psychological Annihilation

If Pose Two is “no money,” then Pose Three is “no belief.”

This is currently MSTR’s biggest vulnerability—and the blind spot most retail investors overlook: premium rate (Premium).

Let me run the math. You pay $100 for one share of MSTR. But of that $100, only $50 actually represents Bitcoin value—the other $50? It’s air. Or, more politely, “faith premium.”

Why would anyone pay double for Bitcoin?

Before the launch of spot ETFs like BlackRock’s IBIT, it was out of necessity—regulated institutions had no choice but to buy stocks. After spot ETFs launched, people still bought MSTR because they believed Saylor could use debt to “feed the coin” and outperform pure hodling.

But this logic has a fatal flaw.

MSTR’s stock price rests entirely on the narrative: “I can borrow cheap dollars to buy Bitcoin.” Once that narrative breaks, the premium collapses.

Imagine if Wall Street continuously suppresses Bitcoin, and the White House pressures MSTR to hand over assets? Or if the SEC suddenly issues a ruling declaring “public company Bitcoin holdings non-compliant”? In that instant, faith evaporates.

This failure mode is known as “Davis double whammy.”

At that moment, the market asks itself a soul-crushing question: “Why pay $2 for something worth $1? Why not just buy BlackRock’s ETF—where it’s 1:1?”

Once this thought becomes consensus, MSTR’s premium—currently 2.5x to 3x—will rapidly revert to 1x, and due to corporate operational risks, possibly even dip below 1x (trading at a discount).

This means even if Bitcoin’s price stays flat, MSTR’s stock could drop 50% overnight.

This is narrative collapse. Not bloody like default, but far more devastating. You watch your Bitcoin unchanged, yet your MSTR holdings shrink by 60%. You begin doubting everything. This is “value killing.”

Pose Four: Closing the Door

The fourth pose is the most concealed, least known—and ironically, the most satirical.

What is MSTR desperately doing right now? It’s aggressively expanding its market cap, striving to enter more indices—already listed in MSCI and Nasdaq, aiming for S&P 500 (Standard & Poor’s 500 Index).

Many celebrate: “It’s in the S&P 500! Trillions in passive capital must buy it—stock price becomes a perpetual motion machine!”

As the old saying goes: good fortune harbors hidden danger.

Because entering U.S. indices, MSTR is no longer a mere pump-and-dump stock—it has become a tiny screw in the U.S. financial system. Wall Street now uses one hand to short MSTR, while the other spreads news of MSTR being kicked out of indices, triggering panic-driven retail sell-offs.

MSTR is now trapped. It wanted to use Wall Street’s capital, but ended up locked by Wall Street’s rules.

It sought to rise using Wall Street’s rules—only to potentially die by those same rules.

Epilogue: The Fate of Court Intrigue

Michael Saylor is a genius—and a madman. He saw through the essence of fiat devaluation and seized the era’s opportunity. He transformed an unremarkable software firm into Noah’s Ark carrying the dreams of millions of gamblers.

But the scale of Bitcoin he controls far exceeds what the company itself can sustain.

Many already speculate that the U.S. government may directly invest in MSTR in the future.

Options include exchanging U.S. Treasuries for MSTR equity, supporting MSTR in issuing government-backed preferred shares, or even direct administrative intervention to artificially boost its credit rating.

The climax of this drama isn’t over. The court intrigue between America’s old and new financial orders rages on. MSTR’s structure is fragile—long on volatility, short on time.

As soon as Wall Street loosens one bolt, the four poses we’ve outlined—price crash, debt default, premium collapse, index strangulation—can collectively destabilize MSTR’s structure in a matter of days.

But conversely: when all chains move in sync, it could become one of the most explosive assets in global capital markets.

This is MSTR’s allure—and its peril.

References:

1. Trump’s Gambit: The Quiet War Between the White House and JPMorgan