Strategy, formerly MicroStrategy, is heavily invested in Bitcoin, holding 650,000 coins worth $48.4 billion at an average cost of $74,400. Despite recent price drops, Strategy’s stock is still in a strong position. The company has significant debt but is not at risk of insolvency unless Bitcoin falls drastically.

While Strategy’s stock is sensitive to Bitcoin’s price, the company is not underwater on its investment. With $8.2 billion in debt and $6.6 billion in equity, Strategy’s balance sheet remains solid. CEO Phong Le stated that the company would only sell Bitcoin under certain conditions, ensuring financial stability.

As the largest corporate holder of Bitcoin, Strategy’s potential sales could impact the coin’s value. However, the market is now more institutionalized, with ETFs and other entities holding significant amounts of Bitcoin. This means that even if Strategy were to sell, there are more potential buyers to mitigate the impact.

Despite concerns about Strategy’s stock and Bitcoin’s price, the company’s balance sheet remains strong. With its investment thesis intact and institutional support for Bitcoin growing, Strategy’s current situation is more of a background concern than an existential threat. The company’s actions are unlikely to significantly impact Bitcoin’s long-term value.

Read more at Yahoo Finance: With Bitcoin Falling, Is Strategy Stock in Trouble?