MSTR's Massive BTC Holdings Lift Prospects: What's the Path Forward?

Strategy Inc. MSTR has evolved into the world’s largest Bitcoin Treasury Company, and its enormous Bitcoin holdings now drive most of its financial performance. As of Oct. 26, 2025, the company held 640,808 BTC, more than 3% of all Bitcoin that will ever exist, firmly linking its prospects to the overall direction of the cryptocurrency market.

In the reported third quarter, with the adoption of fair-value accounting, MSTR recorded $3.9 billion in unrealized Bitcoin gains, driving net income to $2.8 billion. This surge highlights how rising Bitcoin valuations directly translate into outsized earnings for the company. Year to date, Strategy has achieved a 26% Bitcoin yield and $12.9 billion in Bitcoin-related gains, clear evidence of the financial leverage surrounding its BTC-accumulation model.

A major driver of this momentum is MSTR’s strong access to capital markets. Year to date, the company raised nearly $20 billion through ATM equity programs and preferred stock offerings, including $5.1 billion in the third quarter alone. This steady flow of capital enables MSTR to continue purchasing Bitcoin and steadily expand its substantial treasury.

However, the company's earnings are highly sensitive to Bitcoin price fluctuations, which exposes them to volatility. It also has growing preferred-stock obligations that require strong market support. Meanwhile, its software business remains stable but plays only a small role compared to its Bitcoin-focused strategy.

Still, management remains confident. Its updated guidance of $34 billion in operating income and $80 EPS, assuming Bitcoin hits $150,000, shows strong belief in the company’s leveraged Bitcoin strategy.

MSTR Challenged as Crypto Heavyweights Accelerate

Strategy’s Bitcoin strategy is being increasingly challenged by the growing market influence of Coinbase Global COIN and BlackRock, Inc. BLK.

Coinbase, one of the world’s largest crypto exchanges, earns revenues from trading fees, staking and custodial services across multiple digital assets. Similar to MSTR, COIN has become a key Bitcoin proxy play, with rising BTC-linked activity. In the reported third-quarter 2025, Coinbase boosted its Bitcoin holdings by $299 million, bringing its investment and collateral crypto assets to $2.6 billion and $1.0 billion as of Sept. 30, 2025, intensifying competitive pressure on MSTR.

BlackRock, the world’s largest asset manager, offers diversified market exposure and access to Bitcoin through its spot ETF, IBIT. Unlike Strategy’s direct BTC accumulation, BlackRock provides institutional investors a regulated, scalable path into crypto. BlackRock’s influence has surged as its ETF becomes a primary gateway for Bitcoin adoption. As of Sept. 30, 2025, BlackRock reported $13.46 trillion in AUM.

MSTR’s Price Performance, Valuation & Estimates

Shares of Strategy have dropped 38.9% year to date, sharply underperforming the Zacks Finance sector’s 14.3% gain, Coinbase’s 8.1% growth, and BlackRock’s 1.5% return.

MSTR’s YTD Price Performance    

MSTR has a Value Score of F. It is currently trading at a Price/Book ratio of 0.97 compared to the sector’s 4.16X.

MSTR’s Valuation

The Zacks Consensus Estimate for MSTR’s 2025 earnings is pegged at $78.04 per share, a significant turnaround from the loss of $15.73 per share over the past 30 days. The estimate also indicates a strong year-over-year recovery from $6.72 per share.

MSTR stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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