What Happened?

Shares of bitcoin development company Strategy (NASDAQ: MSTR) fell 4.8% in the afternoon session after its stock price fell in tandem with a significant drop in Bitcoin, reflecting the company's deep ties to the cryptocurrency. The company's executive, Michael Saylor, directly linked the stock's steep decline to a four-month bear market for Bitcoin. The digital currency fell from over $110,000 to near $70,000. Market participants increasingly treated Strategy's stock as a Bitcoin-linked instrument. The company's identity is closely connected to its strategy of accumulating large amounts of the digital asset. 

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What Is The Market Telling Us

Strategy’s shares are extremely volatile and have had 58 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 6 days ago when the stock dropped 13.4% on the news that the price of Bitcoin fell sharply and a key analyst significantly lowered their price target on the stock. As the world's largest corporate holder of Bitcoin, Strategy's stock price is closely linked to the digital asset's performance. The cryptocurrency's value fell below $70,000, reaching levels not seen since late 2024. This drop prompted Canaccord Genuity analyst Joseph Vafi to slash his price target on Strategy by over 60%. The analyst noted the cut was mainly because the slip in Bitcoin's price reduced the value of Strategy's large crypto holdings. The stock's decline also occurred as investors awaited the company's fourth-quarter earnings report, which was scheduled for release after the market closed.

Strategy is down 19.8% since the beginning of the year, and at $126.10 per share, it is trading 72.3% below its 52-week high of $455.90 from July 2025. Investors who bought $1,000 worth of Strategy’s shares 5 years ago would now be looking at an investment worth $1,249.

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