Strategy's Bitcoin Treasury Model Unmatched in the Space

Economist Saifedean Ammous believes that only Strategy Inc. can safely replicate its Bitcoin treasury model, which involves borrowing against its massive Bitcoin holdings to fund further purchases.

Strategy holds the largest Bitcoin position of any public company, giving it the lowest borrowing rates in the space. Even during Bitcoin's steepest drawdowns, including the 77% crash in 2021 and last year's decline, the company was not forced into liquidation.

Ammous thinks that Strategy's treasury model is a sound business strategy with room to grow, and that it's the only one that can pull off borrowing against its Bitcoin stack. He attributes this to the company's ability to take on debt at low interest rates.

On the other hand, Ammous argues that Bitcoin's price is not correlated to Federal Reserve policy in the long term. He notes that Bitcoin's price roughly doubled during the Fed's last rate-hiking cycle and kept climbing once the Fed started cutting rates. Ammous estimates that Bitcoin's bottom landed sometime between June of this year and a few months from now, and that the best accumulation window of the cycle will be between mid-2026 to mid-2027.