MicroStrategy’s $51 Billion Bitcoin Stash Sparks Fierce Debate: Is It Worth Half That?
A debate rages over whether MicroStrategy's $51.5 billion Bitcoin holding could actually be liquidated for half its paper value due to market liquidity constraints.Summary
MicroStrategy holds 762,099 Bitcoin valued near $51.5 billion, but experts question its true exit value. Udi Wertheimer argues that a massive sell-off would likely yield no more than $20 billion, citing that a single 500 BTC market order can cause significant price drops, and MicroStrategy controls 3.63% of the total BTC supply.
Conversely, the bull case suggests the holdings are worth a premium because acquiring that much Bitcoin on the open market would cost significantly more than $50 billion due to slippage. This is reflected in MicroStrategy's enterprise value being priced above its net asset value (mNAV) based on enterprise value (1.11), although the basic mNAV is 0.79, suggesting the stock market cap undervalues the BTC holdings.
Furthermore, dilution math favors the bulls, as the number of outstanding shares per Bitcoin held has drastically decreased, meaning shareholders have an increasing claim on the BTC value. Ultimately, the debate hinges on BTC's price, demand for new share issuances, and whether the market continues to view MicroStrategy primarily as a leveraged Bitcoin vehicle.
(Source：BeInCrypto)