The market struggles to price the firm as it shifts from software to Bitcoin-focused holdings.
MicroStrategy (MSTR) stock dropped even though the company now holds only 0.07% of its funds in US dollars and continues to grow its Bitcoin holdings.
Notably, the move has raised questions about how the company is valued by the market with its low exposure to fiat.
MicroStrategy’s latest update showed it had only $50 million in US dollars out of a total $71 billion in treasury assets.
That figure amounts to just 0.07% of its funds kept in fiat currency, marking a new low for the firm. The rest of its holdings is held in Bitcoin.
The company shared this data on August 6, 2025, showing a chart that displayed the large gap between its BTC holdings and its cash balance.
“We hold 7 bps of our treasury assets in fiat,” the company said. That means just seven basis points, or 0.07%, are held in dollars.
This is the lowest level the company has reported since it started converting most of its balance sheet into Bitcoin.
MicroStrategy has become known for its unusual financial strategy. It has steadily increased its Bitcoin reserves while moving away from traditional cash holdings.
The company also shared a post on August 1 comparing itself to top companies in the S&P 500.
It reported an estimated $10 billion in net income and $32.60 in earnings per share for 2025.
Despite this, MSTR stock ranked 96th in market cap and had a price-to-earnings ratio of just 4.7, one of the lowest among all S&P 500 firms.
Market experts considers this an anomaly.
It is worth mentioning that even with high earnings and massive Bitcoin reserves, MicroStrategy stock has not followed the same upward path.
The company’s share price dropped 3.90% over the past month, closing at $380.26.
This came after it posted strong financial numbers and continued to grow its BTC holdings.
In 2025 alone, MicroStrategy reported $14 billion in operating income and $10 billion in net income.
MicroStrategy also expects to reach $80 in earnings per share as the year runs out. Overall, its share price remains under pressure, raising questions about how investors are viewing its business model.
As of the end of July, MicroStrategy held 628,791 Bitcoin, worth about $74 billion.
This makes the company the largest known public or corporate holder of Bitcoin, owning about 3% of the total supply.
MicroStrategy has built its Bitcoin position by raising capital through debt, convertible notes, and other financial tools.
It has used these funds to buy more Bitcoin and to support what it calls a new type of financial structure based on digital assets.
Furthermore, despite its growing asset base, the market seems unsure how to price the MSTR stock.
Interestingly, many still see the company as a software firm that just happens to own Bitcoin.
Its low market cap and low P/E ratio show that its Bitcoin appeal may not yet be fully understood or accepted by all investors.
There are voices in the market suggesting that MicroStrategy may be undervalued.
Some analysts point to the gap between its earnings and its market value. Others note the scale of its Bitcoin holdings and the company’s long-term plans.
Tom Lee shared on social media that MicroStrategy could become the biggest company in the stock market if Bitcoin reaches a price of $1 million.
Whether that happens depends on Bitcoin’s long-term performance. It also relies on investors seeing MicroStrategy as more than a software firm.
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