ilmscore | Banks Are Pushing Bitcoin Into the Death Spiral

Banks Are Pushing Bitcoin Into the Death Spiral

Published: 2025-12-08
Status: Available | Analyzed

Predictions from this Video

Total: 6
Correct: 1
Incorrect: 4
Pending: 1
Unrated: 0
Prediction
Topic
Status
If MicroStrategy's stock trades at a discount to its Bitcoin holdings (MNAV below 1), they will stop issuing shares. If cash reserves run low, they will be forced to sell Bitcoin, potentially triggering a debt spiral.
"In other words, the moment the market stops overpaying for their Bitcoin, everything flips. They stop issuing shares, cuz that would be like selling a dollar of Bitcoin for 80 to 90. You don't want to be selling your Bitcoin at a discount to anyone, right? And if the cash reserves are not enough and they run out, the only way to keep paying those preferred dividend investors is to start selling pieces of the Bitcoin pile. That is the structural comparison that people say looks a lot like a modern version of what could end up becoming the death spiral."
MSTR
Incorrect
MicroStrategy has approximately 21 months of cash reserves to cover its obligations. If this cash runs out and the stock remains below MNAV, they may be forced to sell Bitcoin, initiating a debt spiral.
"And at today's burn rate, they have about 21 months before the cash runs out. If that continues and the cash pile does run out, the only way to keep the machine running is to start selling pieces of the Bitcoin pile itself. And that's what could trigger the debt spiral."
MSTR
Pending
There are opposing forces influencing the Bitcoin price: one incentivized to push it up and another to keep it suppressed for at least another 21 months.
"We're seeing these two forces at play. one that has the incentive of this flywheel to just keep going because that makes the Bitcoin price go up and the other force which has the incentive to keep the price suppressed for as long as possible which in this case at today's present value is for at least another 21 months"
BTC
Incorrect
A conspiracy theory suggests that major banks are shorting MicroStrategy to acquire Bitcoin at a lower price than Michael Saylor originally paid.
"The conspiracy version of this theory says that big banks are shorting Micro Strategy on purpose so that they could buy their Bitcoin cheaper than Michael Sailor did."
BTC
Incorrect
If MicroStrategy's stock price falls below the value of its Bitcoin holdings (MNAV < 1), the company's strategy indicates selling Bitcoin or Bitcoin derivatives.
"The other outcome, right? The not so good one. And here's where they show what happens if the stock ever trades at a discount to their Bitcoin. Remember that's when the MNAV is below times 1, right? It says sell Bitcoin, sell Bitcoin derivatives."
MSTR
Incorrect
MicroStrategy can raise cash by selling its stock at a premium when the stock trades above the value of its Bitcoin holdings. This is a strategy that has allowed them to acquire significant amounts of Bitcoin.
"If the stock trades above the value of their Bitcoin, they can raise cash by selling their shares at a premium. That's how they've been able to get as much Bitcoin as they have today. And it's also why the share price just does not get above a certain price point because the moment it does, Michael Sailor rings the cash register and sells equity to get more money."
MSTR
Correct