Blockstream CEO Adam Back has publicly justified MicroStrategy’s stock trading premium, asserting it reflects the company’s consistent ability to double its Bitcoin holdings per share within 16-18 months and its strategic leverage utilization.
Back emphasized that MicroStrategy’s premium — typically 1.7x to 1.9x above its Bitcoin-backed value — stems from its track record of accelerating Bitcoin accumulation per share, which mitigates long-term investor exposure to Bitcoin price volatility. The firm’s aggressive use of equity offerings and convertible notes has enabled it to amass 592,100 BTC (worth approximately $61 billion), forming a ‘hard currency base’ that validates the premium.
Investors should evaluate the premium by calculating the timeframe required to offset it through Bitcoin accumulation, advised Back, noting that higher market net asset value (mNAV) often signals enhanced yield potential despite volatility. He cited Metaplanet’s Bitcoin treasury model, which withstands mNAV fluctuations of 5x-10x, as evidence of resilience in Bitcoin-centric corporate strategies.
Back concluded that sustainable investments in Bitcoin-focused firms demand scrutiny of three core elements: leverage deployment efficiency, rate of Bitcoin acquisition, and mNAV stability dynamics.