Strategy is under attack by bearish investors after Bitcoin’s price sunk nearly 50% from its October 2025 all-time high.
The world’s largest treasury, led by Bitcoin evangelist Michael Saylor, has become the most shorted large-cap stock in the US, with bearish investors betting against 14% of the company’s entire market capitalisation.
Short sellers are investors that borrow money to then make a bet that a company’s shares will drop. At 14% of market cap, Strategy has roughly $6 billion worth of shares sold short based on its current valuation. That means for every $100 of Strategy stock that exists, $14 worth has been borrowed and sold by bears.
Moreover, Strategy tops Goldman Sachs’ list of the 50 most-shorted stocks with market caps over $25 billion, according to the investment bank’s latest Hedge Fund Trend Monitor published on February 20. Just 63 hedge funds own Strategy stock, representing only 3% of the company’s equity.
That’s a dramatic reversal for a stock that was among the market’s biggest winners during Bitcoin’s 2025 rally.
Strategy’s position atop the short interest rankings reflects growing scepticism about the sustainability of its Bitcoin accumulation strategy, throwing even more shade on a sector in tatters.
Treasury model at risk
Becoming the most shorted mega-cap company in the world is worrying.
Much of that concern stems from the fact that Strategy pioneered the Bitcoin treasury model in 2020. The scheme meant raising capital through stock and convoluted convertible debt offerings to then buy more Bitcoin, amplifying both gains and losses compared to simply holding the cryptocurrency.
The strategy worked spectacularly when Bitcoin rallied. Strategy’s stock surged to over $473 in November 2025 from $12 in 2020, vastly outperforming Bitcoin itself as investors paid a premium for leveraged exposure to the top cryptocurrency.
But now that premium has collapsed. Strategy stock has fallen 18% in the past month, and 60% in the past six months. Shares today trade at around $135, well below the value of the Bitcoin it holds on a per-share basis.
The company owns 717,722 Bitcoin valued at approximately $47 billion.
Bitcoin stagnation
Strategy’s troubles mirror broader weakness in Bitcoin treasury stocks.
The sector has imploded as Bitcoin languishes in the $66,000 to $70,000 range, far below its highs above $120,000.
Strategy now accounts for 99.2% of all Bitcoin treasury purchases, according to BitcoinTreasuries.net. The rest of the sector — 193 other public companies — has effectively stopped buying.
Last week, only one company besides Strategy added any Bitcoin to its balance sheet.
