Strategy’s Phong Le Flags $8K–$10K Bitcoin Level as Key Debt Risk Zone

In recent Bitcoin developments, Strategy CEO Phong Le stated in an interview with Bloomberg TV that the company’s balance sheet would remain strong unless Bitcoin falls into the $8,000–$10,000 range. He emphasized that this level represents a stress point for the company’s capital structure related to debt exposure, rather than a prediction of market direction. With Bitcoin currently trading around $64,500, reaching that range would equate to an approximate 85% decline.

Strategy’s stock (MSTR) closed at $97.58 on Tuesday, marking a gain of about 6% for the day. However, this upward movement does little to resolve the ongoing tension between the firm’s leveraged Bitcoin accumulation strategy and investors’ willingness to continue financing it.

Bitcoin News: Understanding the $8K–$10K Threshold

Le explained that the $8,000–$10,000 range is the level at which Strategy would begin evaluating potential risks tied to its debt obligations. He noted that the company currently feels confident in the strength of its balance sheet and is focused on building a capital structure capable of enduring bear markets while still benefiting during bullish cycles.

He also outlined a more extreme scenario, stating that Bitcoin would need to decline by 90% or remain depressed for five consecutive years before Strategy might consider selling BTC to meet its convertible debt obligations—an outcome he described as highly unlikely. This perspective reinforces Strategy’s consistent stance that any Bitcoin liquidation would only occur under extreme, hypothetical conditions rather than as part of normal operations.

As of mid-2026, Strategy holds over 840,000 BTC, making it the largest corporate holder of Bitcoin globally. While an 85% price drop would significantly impact the value of its assets, the key determinant of forced selling lies in the structure of its liabilities—particularly debt maturity timelines and available cash reserves.

STRC Challenges and the Role of USD Reserves

The company’s more immediate concern is not its convertible debt but its perpetual preferred stock, STRC. Originally designed to maintain a $100 par value while offering a 13% annual yield, STRC fell below par in April 2026 and dropped under $75 in late June before rebounding to around $90. When the stock trades below its par value, Strategy’s ability to issue new shares to finance additional Bitcoin purchases becomes constrained.

To address this, Le highlighted the importance of strengthening U.S. dollar reserves to rebuild confidence in STRC. He noted that maintaining liquidity in USD has proven crucial in recent months and will remain a priority. Following a stock sale, Strategy increased its cash reserves to approximately $3 billion—up from an earlier $1.4 billion target—allowing the company to temporarily halt Bitcoin sales between July 6 and July 12. This reserve level is sufficient to cover dividends and interest payments for roughly 21 months without needing to liquidate Bitcoin holdings.

Earlier in the year, reports indicated that Strategy sold 3,588 BTC at around $60,000—below its average purchase price of approximately $75,000—to fund preferred dividends. Le characterized these transactions as part of routine operational testing and tax-loss harvesting rather than signs of financial distress.

While this explanation is credible given the firm’s current cash buffer, the fact that Bitcoin was sold below cost remains a notable detail that markets have yet to fully evaluate. The company’s Bitcoin Monetization Program is specifically designed to ensure that such sales do not become a recurring necessity.

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