James Chanos Exits MicroStrategy Short as Bitcoin Treasury Stocks Signal Possible Stabilization

• James Chanos closed his short on MSTR and long on Bitcoin, stating the primary opportunity has concluded.

• MSTR’s valuation now aligns closer to its Bitcoin holdings, with premiums shrinking from $80 billion to $15 billion.

• Public companies hold 1,054,735 BTC, or 4.7% of total supply; experts see this as a potential end to the Bitcoin treasury bear market.

James Chanos exits MSTR trade as Bitcoin treasury stocks stabilize post-declines. Discover key insights on crypto market shifts and institutional trends driving recovery. Stay informed on Bitcoin investments today.

What Does James Chanos Exiting the MSTR Trade Mean for Bitcoin Investors?

James Chanos exiting the MSTR trade marks a pivotal moment for Bitcoin-related equities. The renowned short seller’s firm, Kynikos Associates, closed its short position on MicroStrategy (now Strategy, MSTR) and unwound a long position on Bitcoin, noting that the core elements of the strategy had largely unfolded. This decision follows a sharp correction in MSTR’s stock, which opened at $224 on November 7, 2025, reflecting a 50% drop from its annual high.

How Has MicroStrategy’s Valuation Shifted Amid Bitcoin Volatility?

MicroStrategy’s market net asset value (mNAV) has contracted significantly to 1.23x from 2.50x at the time the trade was initiated in late 2024. The firm’s enterprise value stands at $79.5 billion, supported by 641,205 BTC valued at $64.3 billion, offset by $14.4 billion in net debt. This adjustment highlights a narrowing premium, reducing from $80 billion to approximately $15 billion, bringing the stock price nearer to its underlying Bitcoin assets. Chanos indicated that while further modest declines are possible, especially if more shares are issued, the trade’s rationale has diminished. Pierre Rochard, CEO of The Bitcoin Bond Company, views this as an encouraging indicator that the bearish phase for Bitcoin treasury companies may be easing, potentially fostering renewed investor confidence.

Short seller James Chanos exits Strategy (MSTR) trade as Bitcoin treasury stocks show signs of stabilizing after steep declines.

Key Highlights

• Short seller James Chanos closed his short on MSTR and exited a long on Bitcoin, saying the main trade has largely played out.
• MSTR opened at $224—down 50% from its peak—with its mNAV dropping to 1.23x.
• Experts like Pierre Rochard suggest this could be an early signal that the Bitcoin treasury bear market is ending.

Shares of companies whose treasuries are heavily invested in Bitcoin are showing signs of stabilization after a period of steep declines.

This shift comes after well-known short seller James Chanos announced that his investment firm, Kynikos Associates, has closed its short position in Strategy, formerly MicroStrategy (MSTR), and exited a long position on Bitcoin (BTC) itself.

According to the firm’s note, Strategy (MSTR) opened at around $224 on November 7, 2025, down about 50% from its yearly peak. Its market Net Asset Value (mNAV) has dropped to 1.23x from 2.50x when the trade was first recommended in late 2024.

The firm valued Strategy’s enterprise at $79.5 billion, backed by 641,205 BTC worth $64.3 billion and net debt of $14.4 billion.

Chanos said that while MSTR’s value could still fall slightly, the main part of the trade has largely played out. The company’s implied premium, the gap between its total value and its Bitcoin holdings, has dropped from $80 billion in late 2024 to about $15 billion.

He added that if MSTR issues more shares, the premium may shrink further, but it’s now “sensible to close the trade” as the stock’s value moves closer to its Bitcoin holdings.

Pierre Rochard, CEO of The Bitcoin Bond Company, said the move could be an early sign that the “Bitcoin treasury bear market is gradually coming to an end.”

Institutional Trends and Outlook in Bitcoin Treasury Holdings

The landscape of corporate Bitcoin adoption continues to evolve, with public companies collectively holding approximately 1,054,735 BTC, representing about 4.7% of Bitcoin’s total circulating supply. This accumulation underscores growing institutional interest despite recent market turbulence. For instance, Metaplanet, a prominent Japanese investment firm, achieved its 2025 Bitcoin acquisition goal by adding 5,268 BTC on October 1, elevating its total reserves to 30,823 BTC. The company has outlined ambitious plans to expand its holdings beyond 210,000 BTC by the end of 2027, signaling long-term commitment to Bitcoin as a treasury asset.

Despite these advancements, challenges persist. Both Strategy (MSTR) and Metaplanet have endured substantial value erosion, with Metaplanet’s market capitalization declining 56% since June 2025. Some Bitcoin-holding entities have resorted to partial sales of their reserves to manage debt obligations, reflecting the pressures of volatile cryptocurrency prices. However, positive developments are emerging. Reports indicate that U.S. lawmakers have negotiated an agreement to avert a government shutdown, alleviating a major overhang on financial markets and potentially supporting risk assets like Bitcoin.

Market data further illustrates this stabilization. On November 7, 2025, Strategy (MSTR) closed at $241.93, marking a 1.99% gain, and traded at $249.85 in pre-market sessions, up 3.27%. Metaplanet ended the day at ¥427.00, reflecting a 2.89% increase or +¥12.00. Bitcoin itself advanced 3.91% over 24 hours, reaching $106,002, with its market capitalization surpassing $2.12 trillion. Trading volume for BTC surged 45% to $70 billion in the same period, indicating heightened activity and optimism in the cryptocurrency ecosystem.

These trends align with broader analyses from financial data providers, which highlight increasing corporate balance sheet diversification into digital assets. Experts emphasize that while short-term fluctuations remain, the strategic accumulation by firms like Strategy and Metaplanet positions them for potential upside as Bitcoin matures as an asset class.

Also Read: Strategy Inc. to Raise $715M to Increase Bitcoin Holdings

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Frequently Asked Questions

Why Did James Chanos Close His Short Position on MicroStrategy?

James Chanos closed his short on MicroStrategy due to the significant reduction in the stock’s premium over its Bitcoin holdings, from $80 billion to $15 billion. The trade’s core thesis had materialized, with MSTR’s mNAV falling to 1.23x, making further downside limited and prompting an exit for sensible risk management.

What Are the Latest Trends in Corporate Bitcoin Treasury Strategies?

Corporate Bitcoin treasury strategies are gaining traction, with firms like Metaplanet expanding holdings to 30,823 BTC and aiming for over 210,000 by 2027. Public companies now control 4.7% of Bitcoin’s supply, though recent sales for debt coverage highlight risks; stabilization signals a maturing approach to digital asset integration.

Key Takeaways

• Trade Closure Insight: James Chanos’ exit from the MSTR-Bitcoin hedge underscores valuation convergence in Bitcoin treasuries.
• Market Stabilization: Bitcoin treasury stocks like MSTR and Metaplanet show recovery signs, with BTC up 3.91% to $106,002.
• Future Outlook: Monitor institutional accumulation; diversified treasuries could drive long-term growth amid regulatory clarity.

Conclusion

James Chanos exiting the MSTR trade highlights a critical stabilization phase for Bitcoin treasury stocks, as premiums normalize and institutional holdings expand to 1.05 million BTC. With market data pointing to renewed momentum—evidenced by Bitcoin’s climb and volume surge—this development fosters optimism for corporate adoption. Investors should track ongoing policy shifts and acquisition strategies to capitalize on emerging opportunities in the cryptocurrency sector.