MicroStrategy’s Stock Surges with 256% Premium Over Bitcoin Holdings: A Controversial Strategy or a ‘Ponzi Scheme’?

On November 21st, BitMEX Research highlighted a fascinating financial disparity involving MicroStrategy Inc. (MSTR). The company’s stock is currently trading at a substantial **premium** of approximately **256%** compared to the underlying value of the **Bitcoin** it holds. This anomaly is partly attributed to regulatory restrictions that prevent institutional investors from directly purchasing **Bitcoin ETFs**. As a result, investors seeking exposure to **Bitcoin** are turning to MSTR, undeterred by its inflated price.

Additionally, MicroStrategy has adopted a unique **yield strategy** that allows it to capitalize on this premium. By issuing new shares, the firm can amass additional **Bitcoin**, subsequently increasing the asset’s backing for each share. Should this premium remain intact, MicroStrategy could potentially issue enough shares to significantly boost its **Bitcoin** holdings. Analysis indicates that to sustain a **256%** premium, MSTR would require the issuance of up to 157 million new shares, propelling the share price to $1,685 and leading to a market cap of $674 billion, alongside a portfolio boasting 1.9 million **Bitcoins**. BitMEX Research cautions that this model bears resemblance to a “**Ponzi scheme**,” indicating broader market implications.