Strategy's Bitcoin Policy Shift Creates 'Near-Term Noise,' Standard Chartered Says

Uncertainty surrounding a shift in the Bitcoin strategy of major corporate holder Strategy is creating "near-term noise" for the cryptocurrency's price, according to an analyst note from Standard Chartered. The bank maintains that clearer communication from the company could remove this market overhang and has reiterated its bullish long-term price forecast.

Strategy's Shifting Approach

Strategy (formerly MicroStrategy), the largest corporate holder of Bitcoin, appears to be pivoting from its long-held "never sell Bitcoin" mantra to a more complex approach, analyst Geoff Kendrick wrote in a note to investors on Friday. The company's significant market position involves holdings of 843,775 coins, which represents more than 4% of the total 21 million Bitcoin that will ever exist.

This perceived shift has introduced uncertainty for investors, as the market digests the potential for a change in how the company manages its vast crypto assets.

From Accumulation to Collateral

The strategic change is reportedly driven by a decline in the company's mNAV metric—a measure of its enterprise value divided by its Bitcoin holdings—which has fallen to around 1.0. According to Standard Chartered, this valuation makes Strategy's original model of issuing shares to acquire more Bitcoin less effective.

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Instead, the bank suggests Strategy is now moving toward using its Bitcoin as backing for its preferred stock (STRC). This instrument acts as a credit product and has approximately $10 billion in notional value outstanding. Kendrick noted that STRC is "heavily over-collateralised" and should trade back to its $100 par value from its current level of around $90.

Market Outlook and Price Target

Standard Chartered believes effective communication is crucial to calm market nerves. Kendrick stated that a clear explanation of the new approach is "key to reassuring markets that wholesale selling is unlikely." If the company's signaling is successful, it should "remove the need for MSTR to actually sell any BTC," the note said.

Despite the short-term uncertainty, the bank views recent Bitcoin price weakness as "mostly noise rather than a signal" of its medium-term direction. Standard Chartered reiterated its price forecast, maintaining a target of $100,000 for Bitcoin by the end of 2026.