Analysts tell whether bitcoin could fall to $ 74,000

Analysts refute fears of Strategy (formerly MicroStrategy) going bankrupt if the price of bitcoin BTC $89,245.19 Mezo Wrapped BTC 0.99% Market capitalization $47.64 million VOL. 24 hours $1.04 billion drops to $ 74,000. Despite the recent decline in the value of BTC, Strategy owns 672,497 BTC worth about $ 58.7 billion, while its debt is only $ 8.24 billion, meaning that even if it falls to $ 74,000, the total value of bitcoins will exceed $ 49.7 billion.

The company’s financial model does not involve pledging bitcoins, so it is not subject to liquidation requirements or margin calls, as is the case with hedge funds. All of Strategy’s debt obligations are uninsured convertible bonds, which protects its assets even in the event of market volatility.

In addition, Strategy has $ 2.188 billion in cash, which allows it to cover dividend payments of $ 750−800 million annually for the next 32 months without selling crypto assets. Thus, the company’s liquidity is stable, even in the event of a prolonged market decline.

Instead, analysts attribute the fall in Strategy’s shares (MSTR) to external factors. In particular, in October, MSCI proposed to exclude companies with more than 50% of their assets in bitcoin from the indices. JPMorgan also raised the margin requirements for trading Strategy shares to 95%, which increased selling pressure.

The only significant risk remains the dilution of value through new share issues. Strategy has repeatedly raised capital to buy BTC through the issuance of new securities. In the event of a prolonged market decline, this practice could negatively affect the value for existing shareholders if the net asset to capital ratio falls below one.