Strategy's Bitcoin Policy Shift Creates 'Noise' for Crypto Market, Standard Chartered Says

Uncertainty surrounding a strategic shift at Strategy, the largest corporate holder of Bitcoin, is creating short-term volatility for the cryptocurrency, according to a note from Standard Chartered. The bank maintains that clearer communication from the company could resolve the issue and reiterated its bullish long-term price forecast for Bitcoin.

An Evolving Bitcoin Policy

In a note to investors on Friday, Standard Chartered analyst Geoff Kendrick highlighted that Strategy, formerly known as MicroStrategy, appears to be pivoting from its long-held "never sell Bitcoin" policy to a more complex approach. The company is the single largest corporate holder of the digital asset.

Key figures related to Strategy's holdings include:

• 843,775 bitcoins held on its balance sheet.
• This represents more than 4% of the total 21 million BTC that will ever be created.

The bank suggests the shift is driven by a decline in the company's mNAV metric—its enterprise value divided by its Bitcoin holdings—which has fallen to approximately 1.0. At this level, Strategy's previous model of issuing shares to acquire more Bitcoin has become less effective, according to the note.

Market Impact and New Approach

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Standard Chartered said Strategy is now moving toward using its substantial Bitcoin holdings as backing for its preferred stock (STRC), which functions as a credit product. Kendrick noted that STRC, with about $10 billion in notional value outstanding, is "heavily over-collateralised" and should see its price recover from around $90 to $100.

The analyst stressed that "effective communication" from Strategy is crucial to reassure markets that a large-scale sale of its Bitcoin is not imminent. "If this signalling proves effective, it should remove the need for MSTR to actually sell any BTC," Kendrick wrote, suggesting the uncertainty is the primary market headwind.

Bitcoin Price Outlook

Despite the near-term "noise," Standard Chartered views the recent price weakness in Bitcoin as a temporary issue rather than a signal of a change in its medium-term direction. The bank maintained its price forecast for Bitcoin, projecting it will reach $100,000 by the end of 2026.

Kendrick concluded that once Strategy clarifies its new approach, the current "overhang" on the market should be removed, allowing the price to reflect its underlying fundamentals.