Bitcoin briefly crossed $81,000 amid a historic short squeeze that saw record $6.55 billion in bearish crypto positions liquidated in August alone, with over $9.71 billion in total liquidations including $3.16 billion in longs. The top cryptocurrency was last seen trading 0.3% higher at $79,054.33 around 12 p.m. ET Tuesday, according to the latest market reports. This momentum has caught the attention of investors who had previously been looking elsewhere, with crypto-related stocks like Robinhood, Coinbase and Strategy rising 6.9%, 4% and 3.4% respectively. Last week, Bitcoin roared more than 25% higher over three days for its largest three-day gain since 2023, partly fueled by the short squeeze as more than $4 billion worth of bearish crypto positions were liquidated. The forced buying from traders who had bet against Bitcoin gave prices an extra push, contributing to the rapid gains.
MicroStrategy has paused Bitcoin sales for a second consecutive week, removing a three-month sentiment barrier after disposing of 6,948 BTC between late May and early August. However, CEO Michael Saylor's recent post saying "We're Back" has sparked speculation that the company may resume Bitcoin purchases after a 10-week buying freeze. The company's latest Form 8-K covering August 17-23 reported no Bitcoin purchases or sales, marking the second consecutive weekly disclosure with no change to its 840,447 BTC balance. According to Bitfinex analysts, Strategy's status as the largest corporate Bitcoin holder gave each weekly sale added weight among traders, with the phrase "The largest corporate holder is selling" becoming a recurring bearish argument between May and August. Bitcoin now trades above the company's average acquisition price of $75,385, with the current value of Strategy's holdings near $66 billion at current prices. Strategy raised approximately $2.01 billion by issuing 18.26 million MSTR common shares between August 17-23, spending $136.4 million on STRC repurchases and $300 million on dollar reserve expansion.
Strategy's financial position has significantly improved, with net leverage dropping to just 0.1% as the company holds roughly $6.69 billion in dollars while owing about $6.71 billion on convertible notes. The company spent $136.4 million on STRC repurchases and $300 million on dollar reserve expansion, with the remaining $1.59 billion deposited into a new cash account, bringing total reserves to approximately $6.69 billion as of August 23. STRC, the preferred share that pays a 12% dividend, has recovered to $97.33 on August 28 from a 12-month low of $71.25, with CEO Phong Le stating the company's objective is for STRC to trade at $99-$100 over time. Strategy paid $400.7 million on preferred shares in the second quarter alone, with the stakes growing as STRC raised $2.47 billion in July 2025 at $90 per share. The dividend payments are not small, with every dollar spent buying STRC back being a dollar not spent on Bitcoin.
Stockton described a basing phase that started in June for Bitcoin, with a retest occurring in July and a breakout now underway. Bitcoin cleared its 200-day moving average, a level she called an almost precise hurdle back in May. "We have obviously very strong short-term momentum and improved intermediate-term momentum now off of these lows," Stockton stated on CNBC. The rally was partly triggered by the Treasury Department's pledge to "at least double" its debt buybacks, which briefly sent Treasury yields lower and revived demand for risky assets. US spot bitcoin exchange-traded funds drew in $1.92 billion in net inflows last week – their largest weekly haul since October, as mounting concerns over inflation and rising government debt revived institutional investor interest in alternative assets. With Bitcoin traded near $79,183 as of this writing, up 1.3% in a day, MicroStrategy's treasury is barely above water given they paid an average of $75,388 per coin.
MicroStrategy reported its second-quarter 2026 financial results on July 30, showing mixed results due to Bitcoin price volatility. Total revenue increased 6.9% year-over-year to $122.4 million, driven primarily by the company's transition toward cloud-based subscription services. Subscription revenue jumped 54% to $62.9 million, while product-license revenue declined 48.9% to $3.7 million. However, Strategy recorded an $8.3 billion unrealized loss on digital assets compared with a $14.1 billion unrealized gain in Q2 2025, resulting in an operating loss of $8.3 billion versus operating income of $14 billion a year earlier. The company posted a net loss of $8.2 billion, or $24.45 per share, compared with net income of $10 billion, or $32.60 per share, in Q2 2025. Despite the challenging quarter, analysts remain optimistic with B. Riley Securities maintaining a "Buy" rating while lowering its price target to $155 from $215, and Benchmark analyst Mark Palmer maintaining a "Buy" rating while cutting his price target to $435 from $570. The consensus "Strong Buy" rating suggests an upside potential of 79.5% to the average analyst price target of $227.69, with the Street-high target price of $450 indicating a potential rally of 254.8%.
