Strategy Stock: A Leveraged Way To Play Bitcoin

Summary I expect Bitcoin to reach $150,000 by October 2025, with MSTR as a leveraged way to outperform Bitcoin during this bull cycle. MSTR’s massive Bitcoin holdings and AI-powered analytics offerings drive strong investor sentiment and could boost long-term profitability. MSTR is riskier and more volatile than Bitcoin, but buying near cycle lows and selling near peaks can maximize gains. For steady income, MSTY offers high yield monthly distributions, but I prefer MSTR for higher total returns; both have unique risks to consider. Bitcoin ( BTC-USD ) is beginning to break out of its recent consolidation period from the first few months of the year. This could be the beginning of the next significant leg higher for Bitcoin over the next few months. I’m holding to my thesis that bitcoin will reach at least $150,000 by approximately October 2025. I see Strategy ( MSTR ) as a leveraged way to ride this leg higher as MSTR tends to outperform bitcoin during these bull markets. For example, over the past 5 years, Strategy’s price increased 3,484% while bitcoin’s price increased by 1,175% . My thesis for this bitcoin price target is based on a 10x price increase from this cycle’s low of about $15,000 from the end of 2022. The 10x target is based on the 2.618 Fibonacci level, which looks like a reasonable target for this cycle. Bitcoin’s price tends to make lower percentage gains from the bottom to the top in each cycle. Bitcoin’s price increased over 20x in the previous cycle with the peak in 2021. So, I’m conservatively going with 10x for this cycle as the total percentage gains may not be as high as in previous cycles. I’m also sticking to the thesis that bitcoin’s price will peak around October 2025 . This thesis is based on the consistency of the length in days of the halving cycles from the price bottom to the peak. In the last two cycles, bitcoin’s price bottom to price peak lasted exactly 1,064 days. The first cycle lasted a little longer at 1,148 days. So, if the current cycle is consistent with the past 2 cycles, 1,064 days from the price bottom from 2022 should take us to October 2025. Significant Outperformance MSTR vs. Bitcoin Price Performance (weekly chart) (TradingView) Strategy’s weekly chart above illustrates why MSTR can be a more leveraged way to benefit from bitcoin’s rise. MSTR tends to significantly outperform bitcoin during the bull phases of the halving cycle. So, if bitcoin is about to make another leg higher, then Strategy is likely to do the same possibly by a much higher percentage gain. What’s Behind Strategy’s Strong Investor Sentiment ? Strategy has been making significant purchases of Bitcoin over multiple years. As of June 29, 2025, MSTR held 597,325 bitcoins . At the recent price of $118,000 per bitcoin, this equates to $70.5 billion. Strategy owns the most bitcoin of any other corporation (not including exchanges). MSTR considers bitcoin as its primary treasury reserve asset . Strategy’s large bitcoin holdings is important because the company can profit from bitcoin’s rise in price. Bitcoin tends to outperform the S&P 500 ( SPY ) over the long-term. Therefore, MSTR’s large bitcoin holdings may provide an investing windfall for the company over the long-term if bitcoin’s price continues to outperform the broader markets. As a result, investors bid up the price of MSTR in hopes that the company will have increasing value and profitability as the price of bitcoin increases over the long-term. Another reason for Strategy’s strong positive investor sentiment could be a result of the company being involved with artificial intelligence [AI]. AI-related companies have had positive investor sentiment in recent years. Every time period has certain popular investing themes and AI represents one of the current themes that is driving positive investor sentiment in the broader market. Strategy offers AI-powered analytics software/services in the United States and abroad. MSTR’s Strategy One product enables non-technical users with the ability to obtain actionable insights for making key decisions. MSTR also offers other AI-related products & services to provide insights for its users. MSTR’s AI offerings have the potential to grow revenue and earnings for the company over the long-term. Currently, MSTR is unprofitable. However, the company is expected to become profitable in 2027 according to analysts’ estimates. What MSTR does have going for it, is its high gross margin [GM] of 71% . This is significantly higher than the sector median GM of 50%. The company just needs to make a few key tweaks to its operational performance to produce positive operating income. MSTR’s high operational expenses are due to bitcoin’s impairment losses. The company currently has a deferred tax liability when the market value of bitcoin is lower than MSTR’s cost basis on the reporting date. However, this can disappear if bitcoin’s market value increases to a level that exceeds MSTR’s cost basis. If MSTR keeps purchasing more bitcoin at current prices, the company may continue to have deferred tax liability at reporting time. This could change if bitcoin’s price rises at a faster pace as compared to MSTR’s cost basis. Another Option For Bitcoin Exposure If you are the type of investor that likes steady monthly income, then you can consider the Yieldmax MSTR Option Income Strategy ETF ( MSTY ). This is a high yield ETF which is currently paying a 127% annual yield based on the past 12 months of distributions. The distributions are paid monthly and vary based on how well the fund managers are able to implement the long/short strategy using derivatives such as options on MSTR. MSTY holds some U.S. Treasury Notes while implementing its options strategy. There is no guarantee that the yield based on the past 12 months of distributions will turn out as generous over the next 12 months. The price of the underlying MSTY tends to decline in value over time. Therefore, investors should consider the total return to evaluate MSTY as a holding for their portfolios. MSTY also has an expense ratio of 0.99%, which should also be considered. MSTR vs. MSTY MSTR vs. MSTY adjusted for distributions (weekly chart) (TradingView) The chart above shows MSTR’s outperformance vs. MSTY. The chart includes MSTY’s monthly distribution payouts. If MSTY’s distributions are taken out, then MSTY’s return would only be 1.41% over the same period. It all comes down to personal preference and the goals of investors whether to own MSTR or MSTY. Personally, I would prefer to own MSTR over MSTY since I strive for the highest gain regardless of distribution payouts. However, I do understand that others may prefer the steady monthly distributions associated with MSTY. Perhaps others would prefer some combination of both. Risks for Owning MSTR and/or MSTY MSTR can be more volatile than bitcoin. As a result, MSTR tends to lose more value than bitcoin during the bear markets (after the halving cycle price peaks). This means that bitcoin can outperform MSTR over longer periods of time (holding through bull and bear market cycles). Since bitcoin’s bear markets lead to significant losses, I would prefer to sell near the peak price based on technical analysis to maximize gains. The losses during bitcoin’s bear markets could be 70% to 80%. MSTR’s losses could be even greater, at about 90%. This is why gains can be maximized by buying near the low points and selling near the high points. You may not be able to capture the exact bottom or top, but higher gains can be locked in with this strategy. The risk for MSTY is that the underlying price tends to decline over time. The high yield has compensated for this with the high monthly distributions. There is no guarantee that the future distributions will be as generous as in the past. Therefore, it is possible that it could take longer to recoup your initial investment in the form of monthly distributions. It is also possible that the price behavior of bitcoin is not consistent with the length of the previous cycles. It is possible that the current bull cycle will be shorter than previous cycles which could catch investors off guard. Final Thoughts on MSTR I see MSTR as a viable way to profit from bitcoin’s rise. I would choose to do this methodically by buying near bitcoin’s halving cycle bottom and then selling near the cycle peak. This can be done by looking at bitcoin and MSTR’s monthly charts with the RSI and MACD indicators which shows the key turning points at the tops and bottoms of the price cycles. I will be watching the price action for bitcoin and MSTR through the next couple of months, anticipating the peak of this cycle to be around October. Also, MSTR’s AI offerings could help increase sentiment for the stock if it leads to stronger revenue and profitability over the long-term.

Source: Seeking Alpha