Strategy BTC Stash $36B But Data Shows Leverage Risk Is Low
The post Strategy BTC Stash $36B But Data Shows Leverage Risk Is Low appeared on BitcoinEthereumNews.com.
Strategy’s BTC leverage ratio has dropped to just 0.22, its lowest point in years. With $35.9B in Bitcoin and a solid 11.4% YTD return, Strategy’s BTC bet has paid off. Japan’s Metaplanet and Hong Kong’s HK Asia Holdings are following Strategy’s footsteps. Strategy (formerly MicroStrategy), the poster child of corporate BTC accumulation, has just added another 3,459 BTC ($285.8 million) to its reserves, bringing its total now to a staggering 531,644 BTC, worth over $35.9 billion, noted blockchain analysis platform Lookonchain. How Leveraged is Strategy Inc After the Latest Bitcoin Buy? While the online rumor mill churns about Strategy being dangerously leveraged, data suggests otherwise. A breakdown of Strategy’s BTC Leverage Ratio–calculated as (Debt + Preferred Equity) ÷ Value of Held BTC–shows that the company’s current risk exposure is well below historical averages. Looking at the chart spanning from late 2020 to early 2025, a few things are clear. At its peak in Q1 2023, Strategy’s leverage ratio touched 1.27, meaning the value of its debt obligations briefly surpassed the market value of its BTC holdings. Fast forward to April 2025, and the ratio has dropped sharply to 0.22 making it one of its lowest levels ever. This downtrend has been consistent since mid-2023, reflecting both Bitcoin’s rising price and a more measured borrowing strategy. Even during bull runs like in late 2021 and 2022, Strategy operated at significantly higher leverage (e.g., 1.07 in mid-2022 and 1.09 in Q4 2022). So, by comparison, the current posture appears cautious, if not outright conservative. Related: North Carolina’s ‘Digital Asset Freedom Act’ Looks More Like a Bitcoin Bill What Does Strategy’s Low Leverage Signal? This historically low leverage ratio signals financial control, not desperation. It shows Strategy isn’t aggressively borrowing to chase price pumps. Instead, the company uses a mix of equity, debt,…
Filed under: News - @ April 15, 2025 1:28 pm