All In Bitcoin's Five Years, Reflecting on the Extraordinary Path of Strategy

Written by: Luke, Mars Finance

On August 11, 2025, what seemed like an ordinary summer day marked a memorable fifth anniversary for the capital markets. Five years ago today, a business intelligence (BI) software company named MicroStrategy was experiencing little turbulence in the tech world, stable yet lacking growth. However, an announcement it made wrote a disruptive new chapter for the company and the entire industry: purchasing 21,454 bitcoins (BTC) for a total price of $250 million.

This move caused a huge stir in the capital markets at that time. A company listed on Nasdaq publicly announced for the first time that it would use Bitcoin as its "primary reserve asset," which was unprecedented at that time. At that time, MicroStrategy's market capitalization was only about $1.4 billion; five years later, its market cap has soared to over $112 billion, achieving an astonishing growth of more than 78 times, and it has officially renamed itself "Strategy." This leap was not merely a passive ride on the tailwind of rising Bitcoin prices, but stemmed from a well-thought-out, bold, and meticulously designed multi-year strategy.

This five-year retrospective will take you back to the starting point, deeply analyzing the key decisions that defined this transformation, financial alchemy, and risk management, revealing the entire process of its transition from a traditional software company to a Bitcoin giant.

Chapter One: Genesis - Responding to "Great Currency Inflation"

Catalyst of Macroeconomics

Let us return to the macroeconomic backdrop of 2020. At that time, the world was shrouded in the shadow of the COVID-19 pandemic, and central banks in various countries implemented large-scale quantitative easing measures in response to the economic recession. Cash returns continued to decline, and the trend of a weakening dollar became increasingly evident. For companies holding large amounts of cash, this constituted a silent erosion. It was against this backdrop that MicroStrategy's founder and then-CEO Michael Saylor began to seek a refuge beyond traditional assets.

The company clearly stated in its official press release on August 11, 2020, that the decision to invest in Bitcoin was partly driven by "macro factors influenced by the affected economy and business landscape, which we believe are posing long-term risks to our corporate financial plans." This clearly indicates that this move is not a whim of speculation, but a deliberate defensive financial strategy aimed at hedging against macro uncertainty.

"Melting Ice Cube" Theory

Michael Saylor vividly articulated his core argument with his compelling metaphors. He described the hundreds of millions of dollars in cash held by the company as a "melting ice cube," whose purchasing power is continuously eroding in an inflationary environment. In his view, converting this cash into an asset that can withstand inflation and preserve its value is a fiduciary duty that management owes to shareholders.

Bitcoin has become his final choice. Saylor believes that compared to holding cash, Bitcoin, as a "reliable store of value and an attractive investment asset, has greater long-term appreciation potential." This assertion places the company's aggressive actions within a prudent financial management framework. It is no longer merely about pursuing high returns, but actively protecting shareholder value from the erosion of fiat currency depreciation. This narrative is crucial for gaining understanding and support from early investors.

Regard Bitcoin as "digital gold"

Saylor's theory goes far beyond this. He constructed a complete and compelling value system for Bitcoin and defined it as "digital gold." In his initial announcement, he detailed several outstanding attributes of Bitcoin, including "global acceptance, brand recognition, ecosystem vitality, network dominance, architectural resilience, technological utility, and community spirit." He asserted: "Bitcoin is digital gold – more solid, more powerful, faster, and smarter than any currency that preceded it."

This profound, almost faith-like understanding has laid a solid intellectual foundation for the entire Bitcoin strategy. It explains why the company was able to maintain astonishing composure during the subsequent market fluctuations. Because when the foundation of decision-making is a philosophical and ideological identity—namely, a denial of the existing macroeconomic consensus and an embrace of a completely new paradigm of corporate financial management—short-term price fluctuations in the market are no longer a threat, but rather an opportunity to increase positions. This ideological steadfastness is the core driving force behind its ability to navigate through bull and bear markets while continuously executing its strategy.

Chapter Two: Accumulation Engine - The Financial Alchemy of Capital Markets

The Strategy Bitcoin Vault was not built in a day. The evolution of its funding sources clearly outlines an evolutionary path from utilizing its own cash to deftly navigating the capital markets. This chapter will detail the "financial alchemy" behind it.

From private cash to capital markets

In 2020, the company's initial accumulation of Bitcoin primarily relied on cash on the balance sheet. However, as ambitions grew, internal funds quickly became tight. A decisive turning point occurred at the end of 2020 when the company announced it would raise funds by issuing $650 million in convertible notes, which were used to purchase more Bitcoin. As of December 21, 2020, the company had accumulated 70,470 Bitcoins, at a total cost of approximately $1.125 billion. This marked the official beginning of Strategy's financial engineering, transforming the company from a Bitcoin holder into a "hunter" utilizing capital market tools to acquire Bitcoin.

Convertible Bond Script

Convertible Notes have become the most essential financing weapon for Strategy in its early stages. The brilliance of this financial instrument lies in the fact that it offers investors a choice of "advance to attack, retreat to defend."

Mechanism Analysis: The company issues bonds at an extremely low or even zero face interest rate. In return, bondholders receive a call option: if the company's stock price rises above the agreed conversion price in the future, they can convert the bonds into company shares, thereby sharing in the profits of the stock price increase; if the stock price performs poorly, they can still recoup the principal as creditors at maturity.

Classic case: Strategy successfully utilized this tool multiple times in the following years. For example, the convertible bonds issued in February 2021 that mature in 2027, and the convertible bonds issued in November 2024 that mature in 2029, the latter successfully raised nearly $3 billion at a 0% interest rate.

Volatility arbitrage: This strategy is a perfect match for Strategy. MSTR stock has a very high implied volatility due to its strong correlation with Bitcoin. In financial pricing models, high volatility means that the embedded call option is worth a fortune. It is this option value that allows the company to attract investors with very low financing costs, effectively using the market's volatility to provide cheap leverage for its Bitcoin acquisition plans. Interestingly, Michael Saylor's high-profile media image and bold statements have also inadvertently fueled this volatility, creating a self-reinforcing cycle.

Utilizing Premium: In-Market Increase (ATM)

As the strategy progresses, the market gradually views MSTR's stock as a leveraged proxy for Bitcoin. This has led to a significant premium in its stock price over the net asset value (NAV) of the Bitcoin it holds in the long term. In other words, the market is willing to pay a higher price for Bitcoin held indirectly through MSTR stock than for directly purchasing Bitcoin, and this premium arises from the convenience of regulatory access for institutional investors, the liquidity of the stock, and the inherent leverage effect.

The strategy keenly captured and "weaponized" this premium.

"Crypto Reactor": The company has launched a large-scale At-The-Market (ATM) program, continuously selling newly issued shares at a premium in the secondary market. It then uses the cash obtained to purchase more Bitcoin at market fair prices. This process is accretive for existing shareholders in terms of the key metric "Bitcoin per Share" (BPS). The company spares no effort in promoting this metric to the market, successfully creating a recursive loop: premium financing to buy Bitcoin attracts more investors, thereby maintaining or even increasing the premium. This intricate mechanism is vividly referred to by analysts as the "Crypto Reactor."

Innovation in Capital Structure: "Bitcoin Bank"

Entering 2025, the financial innovation of Strategy has reached new heights. It is no longer satisfied with a single financing tool, but has begun to build a diversified capital structure, aiming to become a "Bitcoin bank."

Securities Menu: The company has successively issued various preferred stocks with different yields and risk levels, such as STRK, STRF, STRD, and STRC. These securities provide channels for investors with different risk preferences to participate in its Bitcoin strategy, ranging from equity investors seeking leveraged returns to credit investors pursuing stable high yields. Among them, the initial public offering (IPO) of STRC in July 2025 became the largest IPO project in the United States that year, raising as much as $2.52 billion.

Market Segmentation: Michael Saylor's ultimate goal is very clear: to build Strategy into a leading Bitcoin bank and create a range of capital market tools around this "most valuable asset in the world." He has publicly stated that his competitors are not other cryptocurrency companies, but rather the traditional bond and preferred stock markets, which are worth trillions of dollars.

This series of complex financial operations indicates that Strategy's Bitcoin strategy is far from a simple "buy and hold". It has evolved into a highly integrated financial ecosystem, a sophisticated machine capable of systematically capturing market sentiment (premium) and market volatility (low-cost debt), and converting it into the driving force for continuously accumulating core assets (Bitcoin).

Table 1: Capital Formation for Bitcoin Acquisition by Strategy (2020-2025) The table below outlines the key capital raising activities undertaken by Strategy to fund its Bitcoin acquisitions, illustrating the evolution of its financing strategy from reliance on internal cash to adept utilization of diverse capital market instruments.

Chapter 3: Trial by Fire - Surviving the Crypto Winter of 2022

Any bold strategy must be tested by adversity. For Strategy, the 2022 crypto bear market was the "trial by fire" that determined its survival.

The Storm is Coming

In 2022, with the collapse of the Terra/Luna ecosystem and the bankruptcy of several cryptocurrency lending platforms, the entire crypto market fell into a deep bear market. Bitcoin's price plummeted from its historical high in 2021, and market panic spread. At this time, all eyes were on Strategy, the company that had bet its life savings on Bitcoin. Could it survive this storm?

Panic of margin call

Market concerns are focused on the $205 million Bitcoin collateral loan obtained by Strategy from SilverGate Bank in March 2022. In May 2022, the company's Chief Financial Officer Phong Le revealed during the earnings call that if the price of Bitcoin falls to around $21,000, the company will face a margin call. This means the company must provide more collateral, or the Bitcoin it has used as collateral will face the risk of being forcibly liquidated.

This news immediately ignited market sentiment. As the price of Bitcoin continues to approach this critical line, rumors about Strategy facing imminent liquidation are rampant. This is not only a test of the company's financial stability but also a judgment on the credibility of its entire Bitcoin strategy.

Decisive response

In June 2022, when the price of Bitcoin indeed fell below $21,000, the market held its breath. However, the anticipated collapse did not happen. Michael Saylor's response was swift and decisive; he communicated a clear message to the market through social media and public statements: the company had anticipated such volatility and had built an appropriate balance sheet structure. He emphasized that the company holds a large amount of unencumbered bitcoin, sufficient to be used as additional collateral at any time. Soon after, the company officially confirmed that it had not received any margin call notifications and had enough capital to withstand further market fluctuations.

The resolution of this crisis reveals the deeper logic of the Strategy risk management strategy. Although the company used high-risk leveraged tools, it always maintained a large strategic Bitcoin reserve that was not dependent on any single loan. This reserve acts like a firewall, ensuring that the company has enough buffer space in extreme market conditions without being forced to sell assets at the market bottom. Saylor's confident and transparent communication during the crisis successfully stabilized investor sentiment and firmly controlled the market narrative.

Buy in a bear market

More importantly, Strategy not only weathered the crisis but also took action to demonstrate the firmness of its strategy to the world. Throughout the bear market of 2022, the company did not stop its pace; instead, it continued its strategy of "steady accumulation," increasing its holdings by over 8,109 bitcoins throughout the year. This move conveyed a powerful message: the company's belief does not rely on a bull market, and the price decline is merely an opportunity to acquire more quality assets at a lower cost. In August 2022, Saylor resigned as CEO and took on the role of Executive Chairman to focus entirely on the Bitcoin strategy.

The additional margin call turmoil of 2022 was a decisive moment in the Strategy Bitcoin legend. It proved that the company's model is not only capable of operating in favorable market conditions but is a set of all-weather operational principles. This successful stress test not only solidified its position in the hearts of its followers but also laid a solid foundation of credibility for its subsequent larger-scale capital operations.

Chapter Four: Selerianism - Preaching, Identity, and Endgame

To understand the success of the Strategy, one cannot overlook its soul figure - Michael Saylor. His role has long transcended that of a traditional corporate executive; he is more like a preacher, a philosopher, and the core promoter of its Bitcoin strategy.

The "High Priest" of corporate Bitcoin

Saylor's public image is an indispensable part of his strategy. He frequently appears in various interviews and keynote speeches, using highly provocative language to depict the grand vision of Bitcoin. Bold predictions such as "Bitcoin will rise to 1 million dollars" and "the bear market will never come back" may seem almost reckless in the traditional financial world, but they accurately capture the sentiments of the crypto community and inject a continuous stream of topicality and volatility into MSTR stock. This volatility, as mentioned earlier, in turn fuels his low-cost financing strategy.

Education market, create consensus

Saylor understands that in order for such an aggressive strategy to be accepted by the market, it is essential to win the narrative war. To this end, the company has been hosting the "Bitcoin for Corporations" annual summit since 2021. These summits are not just marketing events; they are a carefully orchestrated industry education. The company invites experts from institutions such as Deloitte to provide detailed explanations of the legal, financial, and operational considerations for corporations adopting a Bitcoin strategy, and offers other companies a complete "action manual." In this way, Strategy positions itself as a thought leader and pioneer in the industry, attempting to create an industry consensus that "adopting Bitcoin for corporations is a wise move," thereby validating its own strategic correctness.

The Evolution of Identity

As the holdings of Bitcoin continue to increase, the identity of the company has also undergone profound changes.

From BI companies to Bitcoin proxies: Initially, the market and analysts gradually viewed MSTR's stock as a leveraged tool for investing in Bitcoin, with its traditional software business carrying less and less weight in the valuation.

Renamed "Strategy": In February 2025, the company officially changed its name from "MicroStrategy" to "Strategy" and launched a new logo featuring the Bitcoin "B" symbol. This marks a complete transformation of the company's identity, with Bitcoin no longer just an asset on its balance sheet, but having become the "core" of its existence.

The vision of the "Bitcoin Development Company": Recently, the company has further positioned itself as a "Bitcoin Development Company". Although the specific investments in software research and development and details of the products remain vague, this indicates the company's future ambitions: to transform from a passive asset holder into an active builder of the Bitcoin ecosystem, thereby binding the company's fate more closely with the future of Bitcoin.

Paving the way for others

The success of Strategy undoubtedly provides a blueprint for other listed companies to follow. Under its leadership, tech giants like Tesla and Block (formerly Square) have also added Bitcoin to their balance sheets. Recently, Trump's Media and Technology Group announced a significant purchase of Bitcoin, hoping to replicate the stock price myth of MSTR. The emergence of these followers further reinforces Strategy's position as a pioneer in the industry.

Fundamentally, Saylor's "evangelism" is closely intertwined with the company's financial operations, mutually supporting each other. Continuous public promotion and industry education have established a loyal investor base, which supports the long-term premium of MSTR stock; while the existence of the premium is key to the operation of its financial accumulation engine. Each brand reshaping by the company is a carefully designed narrative upgrade, aimed at ensuring that the market values it according to the framework it has set. In this grand strategy, the narrative itself is a form of productivity.

Chapter 5: Masterpiece of Leverage or House of Cards?

After five years of rapid progress, Strategy's Bitcoin strategy has achieved astonishing financial returns. However, the market's evaluation of it has been polarized. Is this a financial masterpiece that creates value through leverage, or a house of cards built on risk?

Bullish reasons: an excellent investment tool

Supporters believe that MSTR stock offers investors a unique investment tool that is superior to directly holding Bitcoin.

Leveraged Excess Returns: Data is the best proof. Over the past five years, MSTR's stock price has risen by approximately 7700% (about 78 times), while Bitcoin's increase during the same period is about 878%. This astonishing excess return is derived from its highly leveraged balance sheet structure, which causes its stock price to exhibit a "high beta response" to Bitcoin's price. In a bull market, its gains far exceed those of Bitcoin itself.

Unmatched access channels: For many institutional investors who are constrained by compliance requirements and unable to directly purchase cryptocurrencies, MSTR provides a perfect solution. It is a regulated, highly liquid stock traded on Nasdaq, opening the door for these institutions to indirectly, efficiently, and with leverage invest in Bitcoin.

Analyst Endorsement: Multiple Wall Street investment banks have given MSTR a "Strong Buy" rating. Analysts from firms such as Cantor Fitzgerald and BTIG believe that the company's substantial Bitcoin reserves are a unique asset unmatched by any other entity, and have set a very high price target.

Bearish Reasons: Concentrated Risks and "Ponzi" Structure

Critics' voices are equally sharp, pointing out the enormous risks hidden behind the model.

Extreme Volatility and Correlation: The company's fate is completely tied to the price of Bitcoin. This single risk exposure causes its stock price to be extremely volatile. Once Bitcoin enters a prolonged deep bear market, the consequences could be catastrophic.

The accusation of "Ponzi elements": The most profound criticism points directly at the core of its business model. Some analyses suggest that the "Bitcoin yield" (BTC Yield) heavily promoted by the company, which refers to the increase in Bitcoin holdings per share, does not come from real business operations, but rather from a transfer of wealth from new investors to old investors. The logic is as follows: New investors buy shares issued by the company at a high premium, and the company uses this premium-inclusive funding to purchase Bitcoin at market price, thereby increasing the total holdings of the company, which results in an increase in the amount of Bitcoin represented by each share held by old shareholders. In this model, the premium paid by new investors is the "yield" obtained by old shareholders. Therefore, critics argue that "new investors themselves are the yield."

Stagnation of core business: The financial report shows that its traditional software business revenue has been stagnant or even declining for years. This means that once the Bitcoin strategy fails, the company lacks a strong core business that can generate stable cash flow as support.

Governance risk: The company's strategy and decision-making are highly concentrated in the hands of Michael Saylor, raising concerns about key person risk. Moreover, the company has not provided on-chain reserve data that can be publicly verified, leading to questions about transparency.

At its core, the reasons for being bullish and bearish are actually two sides of the same coin. The mechanisms that create astonishing returns—leverage, stock premiums, extreme bets on a single asset—are also the source of risk. Therefore, investing in MSTR is not only a bet on the long-term price trend of Bitcoin, but also a bet that the market will continue to grant MSTR this unique premium. It is a double gamble.

Table 2: Performance Comparison Analysis (August 2020 - August 2025) The table below visually demonstrates the high-risk, high-return characteristics of Strategy (MSTR) by comparing its five-year performance with its underlying asset (Bitcoin), mainstream technology index (Nasdaq 100), and traditional safe-haven asset (Gold).

Note: Some final values are estimates based on existing data trends, aimed at illustrating relative performance. The total return rate of MSTR is derived from user-provided data and other sources.

Conclusion: Five Years of Legend and the Road Ahead

Looking back at the journey of Strategy over the past five years, its success can be attributed to four interlinked key decisions:

Shift in Thought: In the context of macro changes, a decisive philosophical shift was made from embracing cash to viewing it as a liability, establishing Bitcoin as a new value anchor.

Building a Capital Engine: Creatively designing and executing a diversified capital accumulation engine that systematically transforms market volatility and investor sentiment into fuel for purchasing Bitcoin.

Sticking to the Bear Market: During the industry's winter in 2022, successfully resisted the margin call crisis through a sophisticated financial structure and firm belief, and increased holdings against the trend, demonstrating the resilience of its strategy.

Narrative control: Through Michael Saylor's personal charisma and the company's strategic communication, successfully shaped market perception, deeply binding the company's identity to its Bitcoin strategy, and providing public opinion support for financial operations.

Is it a replicable blueprint or a unique phenomenon?

Although other companies have begun to imitate Strategy by incorporating Bitcoin into their balance sheets, the complete script of "Saylorism"—a combination of financial engineering, leader cult of personality, and a thorough transformation of corporate identity—is likely a unique phenomenon created by a specific person in a specific historical period, difficult to fully replicate.

The road ahead is long.

The first five years have written a magnificent chapter, but the road ahead remains full of challenges. The core issue is: with the popularity of compliant products such as Bitcoin spot ETFs, can MSTR's high premium be sustained? What regulatory risks will the company face? Can its transformation into a "Bitcoin development company" succeed and create real operational value from the ecosystem?

The first act of the Strategy has successfully premiered, but the grand drama is far from over. The world will watch closely to see how its second act will continue the legend or lead to its conclusion.