Bitwise: MicroStrategy’s cash, deferred debt mean it won’t be forced to sell Bitcoin
Bitwise CIO Matt Hougan says fears that MicroStrategy will be forced to liquidate its Bitcoin are misplaced. In a December 2025 memo, Hougan notes MicroStrategy holds roughly 650,000 BTC with an average cost basis near $74,436 while Bitcoin trades above $92,000, providing a significant unrealized NAV buffer. The company raised about $1.4 billion in recent at‑the‑market share sales and has no principal debt due until 2027; annual interest and operating needs near $800 million can be covered by current cash reserves for roughly 18 months. CEO comments about a hypothetical last‑resort sale if liabilities exceeded assets and funding dried up were clarified by Hougan as not reflecting present conditions. Remaining risks include index reclassification guidance (MSCI) for firms with large crypto exposures and the firm’s use of convertible notes and leverage, which can amplify equity volatility. For traders: MicroStrategy’s BTC position remains profitable versus its cost basis, MSTR stock will likely stay sensitive to BTC price moves and equity-market sentiment, but immediate forced‑sale risk appears limited given cash on hand and deferred maturities.
Neutral
The news reduces the probability of a forced liquidation of MicroStrategy’s BTC holdings, which is neutral-to-mildly bullish for Bitcoin price fundamentals because it removes a large, immediate supply overhang. Key supportive points: a large BTC holding (≈650k BTC) held at a cost basis (~$74k) below current prices, $1.4B in recent cash proceeds, and no principal debt due until 2027—cash covers roughly 18 months of interest/ops. Offsetting factors that cap bullishness include high leverage via convertible notes, equity volatility (MSTR share drop >24% recently) and potential index reclassification (MSCI) or funding shocks that could still force actions in extreme scenarios. For traders: short-term BTC and MSTR price moves will remain correlated and sensitive to equity sentiment and leverage dynamics; absence of imminent forced selling lowers tail‑risk but does not eliminate volatility tied to leverage or macro tightening.