Strategy Prepares for Worst-Case Bitcoin Scenario with Stress Test Results
As the Bitcoin price continues to drop, Strategy, the largest corporate holder of Bitcoin led by Michael Saylor, has revealed its stress test results. According to the test, even if Bitcoin's price declines by 11.4% annually for nearly six years, Strategy will be able to maintain its financial obligations.
The scenario assumes a sustained annual decline of 11.4% over five and a half years, with the current price of $64,428. Despite this significant drop, Strategy claims it would still be able to fully fund its interest payments and preferred stock dividends while maintaining a 1.0x BTC rating.
This stress test is part of Strategy's efforts to demonstrate its resilience in a prolonged bear market. The company has also launched an overhaul of its financing model, which includes restoring the price of its preferred shares, Stretch (STRF), and allowing it to resume buying Bitcoin.