Strategy’s Strategy Appears to Have Failed, and the Outlook of MSTR Stock Is Unfavorable

Strategy (MSTR) has failed to capitalize on Bitcoin's rally, with the company's average purchase price for Bitcoin sitting around $75,412 as of Sept. 1. Despite President Trump's positive remarks and Treasury Secretary Bessent's bond buyback plan, Bitcoin was trading at about $77,275 on Sept. 2. After spending heavily on purchases, interest, and dividends, Strategy is likely losing money on its Bitcoin investments.

Its stock has dropped 19% year-to-date and 63% in 2025, reflecting the failure of the company's strategy. Strategy CEO Michael Saylor has also admitted the company's business model is broken by selling Bitcoin earlier this year and planning to increase lending. Despite Bitcoin's recent rally, its long-term outlook appears unfavorable.

The cryptocurrency's value is tied to its ability to retain value better than other assets, but Bitcoin has declined by about 30% in the past year and nearly 40% from its all-time high. With rising interest rates, high debt, and inflation, Bitcoin may weaken further. Additionally, the Clarity Act, which could positively impact the crypto sector, is unlikely to pass Congress in 2026, and Democrats are expected to oppose crypto.

Despite Trump's potential favorable regulations, the Trump administration may struggle to help the sector due to opposition from Congressional Democrats and wary big banks.