Key Points
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Since Strategy created its first Bitcoin purchase in August 2020, the stock has outperformed the top cryptocurrency and the broader S&P 500 by wide margins.
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Becaapply this business raises capital from various sources to accumulate more Bitcoin, its share price is more volatile to the upside and downside.
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Investors who understand the heightened risk profile are the only ones who should consider purchaseing Strategy stock.
In August 2020, Strategy(NASDAQ: MSTR) created headlines by purchaseing $250 million worth of Bitcoin to hold on its balance sheet. Since that relocate, shares have climbed 1,170% (as of April 20), outperforming the digital asset and absolutely crushing the S&P 500 index, despite Strategy trading 64% off its peak.
Strategy is now the world’s leading Bitcoin treasury company and essentially a leveraged Bitcoin exalter-traded fund, taking on debt and selling stock to finance more Bitcoin purchases. Is that a good thing?
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For long-term Bitcoin bulls with high risk tolerance, yes. For most investors, probably not.
Image source: Getty Images.
Strategy’s strategy is to accumulate more Bitcoin
Strategy’s business model relies on raising capital from various sources (equity, preferred, and resolveed-income markets) to accumulate more Bitcoin and add it to the balance sheet. According to research from The Motley Fool, this company is the largest corporate holder of this cryptocurrency in the world. After a $2.5 billion purchase on April 20, Strategy now owns more than 815,000 units of Bitcoin, a largeger position than iShares parent BlackRock, valued at $62 billion at today’s price.
The company’s billionaire co-founder and executive chairman, Michael Saylor, is perhaps the strongest and most visible proponent of Bitcoin in the world. Management’s plan is to raise $84 billion in the “medium-to-long term” to continue running this playbook, including money raised for a prior goal of $42 billion announced in October 2024.
Strategy calls its stock “amplified Bitcoin.” Instead of pushing for higher earnings per share like regular companies, this business prioritizes growing its Bitcoin per share (BPS). This is a novel financial metric that indicates ownership of the cryptocurrency rising over time for investors. BPS surged 74% in 2024 and climbed 23% in 2025. And so far in 2026, it’s up 9.5%.
Investors must be comfortable taking on more risk
There are investors out there who are bullish on Bitcoin, so they purchase and hold the top digital asset. There are other investors willing to accept greater uncertainty in order to achieve higher returns. These people will turn to Strategy stock.
The fact that it can be viewed as a leveraged Bitcoin ETF is not necessarily a good or bad thing. It’s the result of financial innovation.
But it’s important to understand that volatility can be extreme. Right now, Strategy shares are 64% below their record. And Bitcoin is 41% off its peak. In the next bull market, investors can expect Strategy to outperform the crypto, as its price swings are more pronounced (to the upside and downside) due to its capital structure.
Investors considering purchaseing Strategy stock must obviously be optimistic about Bitcoin. But it’s also critical that the company continue to raise capital when it necessarys to. And leadership must operate with rigorous financial discipline and risk management.
Should you purchase stock in Strategy right now?
Before you purchase stock in Strategy, consider this:
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Neil Patel has positions in Strategy. The Motley Fool has positions in and recommfinishs Bitcoin. The Motley Fool recommfinishs BlackRock. The Motley Fool has a disclosure policy.
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