Bitcoin treasury businesses focused on buying and holding the asset may find it difficult to outcompete Strategy, according to economist and Bitcoin Standard author Saifedean Ammous. Speaking on Cointelegraph’s Proof of Thesis, Ammous argued that Strategy’s scale and financing advantages make the model challenging for smaller players to replicate.
The comments come as Strategy continues to defend its ability to service obligations through drawdowns, a topic that has been under scrutiny since Bitcoin slipped below $60,000 and Strategy’s STRC preferred stock traded well under its stated target price of $100. Ammous said the company’s cash position and funding structure have so far kept it away from liquidation risk during periods of price stress.
Key takeaways
- Ammous says Strategy’s size helps it borrow on better terms, creating a structural advantage over smaller Bitcoin treasuries.
- Strategy’s 8-K filing reports 847,666 BTC acquired for $63.95 billion and a $5.02 billion US dollar reserve for preferred dividends and debt interest.
- Financing concerns intensified earlier this year after Bitcoin fell below $60,000 and STRC preferred stock traded far below its $100 target.
- Ammous expects broader business adoption of holding Bitcoin as a reserve asset, but he still cautions that investing in Strategy carries risks.
- He suggested Bitcoin’s next cycle peak could occur in 2029 and offered a cautious rough estimate for 2030.
Why Strategy may be hard to beat
Ammous framed the competitive landscape around treasury size. In his view, Strategy’s position as the largest corporate holder of Bitcoin enables better access to capital—an advantage that smaller treasury companies may struggle to match.
He pointed to the fact that Strategy’s prior drawdowns had not pushed the business into a close-to-liquidation situation. While price declines can pressure any treasury-backed financing strategy, Ammous argued that Strategy’s structure has been able to absorb volatility so far.
That matters because Bitcoin treasury models typically blend asset accumulation with the need to meet ongoing payments. When market prices fall sharply, the key question becomes whether the company can continue to service obligations without being forced into unfavorable actions.
Strategy’s reported reserves and what they’re for
According to Strategy’s Monday 8-K filing cited in the discussion, the company reported holding 847,666 BTC acquired for $63.95 billion. The same filing reportedly includes a $5.02 billion US dollar reserve designed to cover preferred stock dividends and debt interest.
Those figures are central to Ammous’s argument that investors shouldn’t interpret Bitcoin price drops as automatically implying near-term distress. Instead, he emphasized the role of the company’s cash on hand in meeting scheduled payments.
“Even a much bigger Bitcoin drawdown is going to leave them in a decent situation because they have enough cash on hand to make their payments,” Ammous said during the episode.
His remarks also reflect a specific tension in treasury strategies: companies can increase their Bitcoin exposure over time, but markets often focus on how financing instruments behave under stress. In Strategy’s case, the preferred stock market has reacted strongly to drawdowns, turning cash reserves and payment coverage into the focal point for risk assessment.
What changed after Bitcoin slid and STRC traded below target
The financing model became a more visible issue over the summer as Bitcoin fell below $60,000 and STRC preferred stock traded substantially below its target price of $100. The episode referenced Strategy’s subsequent steps, including raising STRC’s annual dividend rate to 12%, repurchasing shares, and building its cash reserve.
Strategy also reportedly sold some Bitcoin to fund dividends and STRC repurchases before resuming its Bitcoin accumulation. That sequence highlights how treasury companies may respond when both asset prices and related financing instruments weaken: they may reduce some exposure in the short term to preserve obligations, then continue accumulation once conditions stabilize.
Ammous’s broader point is that Strategy’s balance sheet planning—including its cash reserves—has been sufficient to prevent earlier drawdowns from becoming immediate liquidation threats. Still, he did not suggest that the model is risk-free, and he encouraged investors to treat Strategy as a distinct investment rather than a simple proxy for owning Bitcoin outright.
How Ammous sees business Bitcoin reserves—and the risks
Beyond Strategy, Ammous argued that the adoption of Bitcoin as a corporate reserve asset could expand. He said businesses with positive cash flow can allocate surplus funds into Bitcoin as a long-term reserve rather than treating the asset as merely a speculative position.
He differentiated between surplus cash—available after covering daily, weekly, and monthly operational needs—and funding that companies would need for routine expenses. In his view, that distinction determines whether Bitcoin allocation is sustainable through volatility.
Even so, Ammous cautioned that investing through a Bitcoin treasury vehicle can introduce additional risk layers compared with holding Bitcoin directly. He said he favors holding Bitcoin on its own, reflecting his concern that corporate structures, preferred instruments, and financing arrangements can produce outcomes investors may not expect when they assume “Bitcoin treasury” is equivalent to direct ownership.
In practice, the debate is likely to remain about trade-offs: treasuries may offer a pathway for mainstream corporate adoption or capital-market access, but they can also involve financing structures that react differently to drawdowns than the underlying asset.
Cycle expectations: a 2029 peak and a cautious 2030 guess
Ammous also discussed the outlook for Bitcoin’s price cycle. He said Bitcoin has probably already bottomed, while acknowledging that another crash remains possible. He suggested that Bitcoin’s next cycle could peak in 2029, with prices rising predominantly until that point.
We may bottom again, we may witness another crash that takes us down.
He added that smaller drawdowns could make Bitcoin more attractive to large asset managers once the memory of previous bear markets fades. When institutional participants feel the downside is more manageable, allocation decisions can become easier—even if the longer-term cycle risks remain.
Asked for a Bitcoin price estimate for 2030, Ammous offered a rough figure around $200,000. He said the estimate was based on the Bitcoin power-law model and selected a number near the lower end of the range he cited. However, he emphasized uncertainty, adding, “I wouldn’t bet on it.”
For traders and portfolio managers, the key practical takeaway is that cycle-based expectations can shape positioning, but Ammous’s own caveats underline that volatility and potential renewed drawdowns are still plausible even after a perceived bottom.
Readers watching the next phase should focus on whether Strategy—and other treasury-linked structures—can maintain payment coverage through new drawdowns, and on how markets price the risk of treasury financing instruments during periods of turbulence, especially as broader corporate participation in Bitcoin reserves remains an open question.
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