Benchmark Reaffirms Strategy as Top Bitcoin Proxy, Downplays Solvency Concerns

Wall Street broker Benchmark is dismissing fears over the solvency of bitcoin treasury company Strategy (MSTR), calling the stock the “strongest asymmetric bet on bitcoin.”

In a report released Monday, analyst Mark Palmer said recent bitcoin price declines have sparked familiar, yet overblown, concerns about the company’s balance sheet. Strategy holds roughly 649,870 BTC (valued at $55.8 billion), along with $8.2 billion in low-cost convertibles and $7.6 billion in perpetual preferreds, making its obligations manageable and its structure more resilient than critics suggest.

Benchmark highlighted the advantage of perpetual preferreds, which provide permanent capital with no refinancing cliff—a feature other digital-asset treasury firms lack. According to the broker, bitcoin would need to fall below $12,700 and remain there—an 86% drop—for Strategy to face solvency risk, a scenario it considers highly unlikely in today’s institution-driven market.

Palmer reiterated his buy rating on MSTR with a $705 target, based on a 2026 bitcoin assumption of $225,000, noting that the recent pullback does not change his outlook. Shares were down 4.7% at $168.82, while bitcoin traded 6% lower at about $86,000.

Amid volatility in the digital asset treasury sector—including ETF flow swings and liquidity pressures—Benchmark sees Strategy as a standout: scalable, yield-generating, and structurally advantaged. The firm expects the company to lead a rebound as liquidity and regulatory clarity improve.

On Monday, Strategy also announced a $1.44 billion U.S. dollar reserve, funded primarily through last week’s common stock sales. The reserve is intended to cover at least 12 months of dividends, with potential for further expansion.