I started a blog back in the days when I was studying Finance at university. A lot has changed since. Which is a good thing – my personality is such that I am looking for constant progress and if I had the same knowledge and thinking as my old self – well, I would have a problem to solve.

I studied mainstream or Keynesian economics which teaches us that you can model and forecast everything – from the GDP or inflation to consumer behavior all the way to revenues, profitability and valuation of a company. So that means the fields of macroeconomics, microeconomics and corporate finance or investing. All of that plus much more can be measured and forecasted with a complicated enough Excel model.

And I believed it for some time. But then I started to question if we can measure and predict individuals and their behavior. Sure, if I punch someone in the face it would be almost certain to expect some kind of an answer after that. But are we as predictable as a species as some of us think we are? That led me to discover the Austrian school of economic thought which has a totally different worldview – that we shouldn’t create complicated models to predict humanity’s preferences and behaviors and use them to influence their lives for a greater good. Forget the moral part, no one is omniscient enough to do such a thing.

OK, so if the Austrians were right about the field of microeconomics, and maybe macroeconomics as well, since if we cannot predict one person’s choices and actions in a constantly changing world, how can we do that when we have billions of such cases. What about the corporate finance or investing side of things? If we were to dispose of GDP, inflation, unemployment, etc. targets politicians set and let the free market figure it out, what do we do with corporation’s budgets or pension fund investments? The more I thought and dug into this, the more questions I had. For example, according to the Austrians things do not have intrinsic value and all value is subjective – one man’s trash is another man’s treasure. But how to value an investment in a company based on this – if the company doesn’t have an intrinsic value (retained earnings, property, cash, etc.) how can we even know if we should invest in it or not?

Fast forward to the end of 2025 – I don’t claim I have all the answers, but when I hear an analyst say markets are rational and effective I get a weird feeling. Why? Because most of us aren’t. And I can prove it to you – I am a bitcoiner. I bet this sentence has changed a lot for you and that is all emotion. Since I became a bitcoiner I realized thanks to all these complicated economic models and corresponding philosophies we have a list of useless professions that do not add a lot of value to society. And unfortunately everyone has to work two jobs – one being his/her day job and the other is to either learn how to invest on his own and outpace inflation or hire a financial consultant who will do it on his/her behalf. This is because saving is a bad thing and society has done everything to discourage people from it.

So I spent a few years trying to value and invest in companies on my own. Why would I hire someone else when I studied finance, right? Yes, the problem is markets are not rational and can stay irrational longer than you can stay solvent. I haven’t done any trading or something of that sort but doing the math I can safely say my second job was unsuccessful. The problem is that I spent a lot of time and effort and still couldn’t manage to beat inflation. And that is from a person who thinks he knows how to value a company. By the way, a lot of professional analysts are the same. So what is the solution? I already said it without saying it. We need to encourage saving and we need sound money. That way people will have to work only one job and not worry about the purchasing power of their money.

700 words without even mentioning the topic of this article. Congratulations to whoever made it this far. The fun starts now.
MSTR stands for Strategy (formerly MicroStrategy), the now famous bitcoin exposure company. A lot of people have polarizing views about the company and its chairman Michael Saylor – from a Ponzi scheme to a genius play. Started as a business intelligence software company turned bitcoin treasury company, have they found the cheat code? If you are unfamiliar with what they do, their core business brings home about 500 million USD revenue a year, yet they claim they hold 640 031 bitcoins as of September 2025 which if we assume 1 bitcoin = $100 000 would equate their balance sheet to at least 64 billion USD. Compare those 64 to the 1.4 billion the company was valued at the beginning of 2020 when they were just a software company. It is not correct to compare individuals to corporations but for the sake of the argument – this is the equivalent of me earning $100 000 a year managing to acquire something that is worth 20 millions for let’s say 5 years. Companies, especially publicly-traded ones, have many ways to seek and receive financing and that is what at MSTR have been doing.

In order for us to properly understand the whole picture, we must start with some basic terminology. What is the balance sheet, profit and loss statement, assets, liabilities, leverage, liquidation, mNAV – every analyst should be able to know all of this. The tricky part is pioneer metrics the company has come up with – bitcoin yield, bitcoin per share. Even after understanding all of this there is the subjective as the Austrians would say: one would want a 10% return on the investment while others not. What I am trying to say is valuation and investing is not that straightforward and even after investing you must constantly revisit and adjust. Unfortunately, as I said, we are forced to play in this game by the current monetary system. 

Let’s switch back again to the main topic of this – MSTR. Since it is a publicly-traded company, we can have a look at the financial statements. A US-listed company reports quarterly what is called 10-Q files and annually 10-K. We can derive necessary information from there. Let’s start with the balance sheet (a snapshot of the company at any given time, Dec 31st, September 30th, etc.). By no means is this a deep breakdown of everything, so the least we have to know about the balance sheet is that it comprises of assets (think of it as resources) the company has acquired (land, equipment, cash, buildings, materials, bitcoin) and liabilities (borrowed money) or equity (owner’s funds) which were used to acquire the assets. Assets must equal the sum of liabilities and equity. The profit and loss statement (or income statement) is a little bit different – it is not a snapshot of any given time, it covers all incomes and expenses the company made during a specific period (a year, quarter, month). 

And there are KPIs which we can use to determine how successful a company is by looking at those two statements. For example MSTR (and Saylor has publicly said it multiple times) was not in a good shape – the business was not growing – and they had to think of something to change that. This is the problem with the current monetary system – all individuals and companies have to think how to constantly grow their income and on top of that how to store their accumulated savings so that inflation does not erase their purchasing power. For example Apple, Amazon, Nvidia, Meta and many others are losing billions of dollars in purchasing power just by holding cash in reserves and if the business stops growing they will have to solve that problem. Michael Saylor discovered bitcoin after going through all options MSTR has to combat inflation and continue operating. And that transformed the company.

Just as an individual can get in a lot of debt, so can companies. Some critics of MSTR have said the company is too levered and it will not end well. We can see most of this debt issuance took place after 2023 so this is why we are looking only at 2025, 2024 and 2023 figures. On a nominal basis the liabilities did increase from 2.5 billion USD to more than 21 billion as at September 2025, or more than 8 times, but the bitcoin acquired by the company increased from 3.6 billion to 73 billion, which is a 20x increase. Part of that is price appreciation of bitcoin of course, but MSTR has acquired bitcoin not only by taking on more debt, but by issuing more ordinary shares of the company.

MSTR balance sheet snapshot

And why wouldn’t they issue shares, when the stock price trades at a multiple to its mNAV. This means if bitcoin trades at $100 000 and MSTR’s mNAV is x2, whoever is buying shares with the goal to have bitcoin exposure, he is effectively buying bitcoin at $200 000.

MSTR mNAV historical graph

And due to this mNAV premium the company can also track and improve on the newly created “bitcoin per share” and “bitcoin yield” metrics.

For the trailing 12 month period, the bitcoin yield is 86% which means MSTR has managed to grow the accumulated bitcoin faster than the issued shares, which is good for the investors. Yes, if I have 1 share of the company out of a total of 100 and they create 100 new shares I get diluted and own less as a total percentage of the company, but I get compensated by the fact this share now owns more of the total supply of bitcoin. If the rate increase of share issuance outpaces the rate of bitcoin accumulation this will not be OK for me as an investor. This is the reasoning why someone would be willing to put a premium on MSTR.

We saw the company has issued new debt since 2023, a question everyone considering whether to invest in the company would ask is how are they going to service this debt: as we know most of the time when we are in debt we have to make monthly or quarterly interest payments in addition to the principal repayment. MSTR has structured its debt in various forms. Most of it is convertible notes, which means at a specific date in the future the principal can get converted into ownership of the underlying company instead of repaid. The criteria is the stock price at that moment, if it is above the agreed upon level, then it can get converted. In addition to that some of the convertible notes MSTR has issued are not interest-bearing since the rate is 0%. Saylor basically found the cheat code if bitcoin appreciates as he expects in the next 4-5 years. But not all financing is structured that way. In 2025 the company decided to start offering preferred stock with perpetual dividend payments. 

What does this mean? In standard corporate capital-structure norms the hierarchy (in case of liquidation or claims, and for seniority) for MSTR is debt (secured, unsecured and convertible), preferred stock and then common stock at the end. This means if an event happens convertible bondholders will get paid before preferred stockowners. This is a reason why the dividend rate of the preferreds is 8% and above. The word perpetual means indefinite, there is no end date, while the convertible debt has maturity dates in the next 5 or so years. This has created a lot of pushback and rightfully so in my opinion. How is the dividend going to get paid? The worst case scenario is occasional sales of bitcoin since if we do the math (as well as look at the income statement), the math ain’t mathing. The highlights in yellow for the nine-month period of 2025 up to September show that the result the company generated was 246 minus 91, 71, 115 – negative 31 million. Not only did the operating segment not manage to be profitable, but MSTR had to distribute 198 million in dividend payments to preferred equity holders. As a retired amateur stock analyst when I heard the company issued the first preferred stock (STRK) the first question that popped in my mind was “is the software business be able to cover this dividend”. If the answer is negative, this is my personal opinion, I would classify it as a Ponzi scheme. Here is why: if the intention is to never sell bitcoin, then the dividend will get paid by the next financial instrument the company issues (the next convertible debt or preferred equity or something else). The reason is the company has not shown a business model that can sustainably finance the dividend payments they are promising. The logic “bitcoin will have a compounded growth of pick your desired rate and this will fuel the company to issue more debt with bitcoin as a collateral is a very Ponzi-style explanation to me.

But what if we take previous year business performance of the company, 2025 has not even ended so maybe it was a fluke and they can cover the payments? Looking at 2024, 2023 or 2022 this is not the case. In 2022 the company had 12 million after all incomes and expenses which can be allocated to service its debt payments. 2023 was even worse – 2 million. And in 2024 there wasn’t a profit to begin with. So the underlying software business is struggling to even be profitable, of course part of the expenses are bitcoin-related since I do think this is their main focus now, but this is a red flag at least to me and a signal of a Ponzi-style operations.

So what was the idea behind this article? It was not to figure out if MSTR is a Ponzi company. It was not to figure out what is the “intrinsic” value of the company and whether to invest in it. What the takeaway should be is that if we don’t have sound money we have to do all of this just to preserve our purchasing power. Some people prefer to buy real estate properties, which again takes time to evaluate where, when and how to buy. Every professional, no matter in the field of finance, health or media, has to figure out two things:

1. How to earn money

2. How to keep the purchasing power of the earned money

I think earning money is enough as a task for humans and we shouldn’t be living in a system which forces you to learn how to read financial statements if you are a doctor or a plumber. Fix the money, fix the world.