Strategy Inc. Stock Crashes 15% as Bitcoin Tumbles to Three-Month Lows

Strategy Inc. got hammered yesterday. The software company’s shares dropped 15% to $28 as Bitcoin crashed to its lowest point in three months, dragging down firms with heavy crypto exposure across the board.

The U.S.-based company, which holds over 130,000 Bitcoins worth roughly $4.5 billion at current prices, reported a brutal $24 million quarterly loss on February 5, 2026. That’s a massive swing from the $10 million profit they posted in the same quarter last year. CEO Michael Evans blamed half the loss on Bitcoin’s wild price swings, with the rest coming from higher operating costs that keep piling up.

Bitcoin’s having a rough week.

The cryptocurrency plunged 20% in just seven days, hitting $34,000 and sending shockwaves through companies that bet big on digital assets. Regulatory crackdowns in the U.S. and Europe are spooking investors, with the SEC tightening controls on crypto exchanges and European authorities cooking up stricter trading rules. But Evans isn’t backing down from his Bitcoin strategy, calling it a “strategic asset” despite the bloodbath.

“We believe in Bitcoin’s potential,” Evans said during the earnings call, though his optimism didn’t stop investors from running for the exits. Trading volume surged as shares opened down from $33 the previous day, pretty much reflecting broader skepticism about crypto’s place in corporate treasuries. And Strategy Inc. isn’t alone in feeling the pain – NextGen Solutions dropped 12% while Tech Innovators fell 14%, both citing Bitcoin’s collapse as a major factor.

Financial analyst Lisa Chen thinks Strategy Inc. is playing with fire. “Bitcoin’s sharp price swings can significantly impact a company’s balance sheet,” she warned, pushing for a more diversified approach to dodge the risks that come with crypto investments. The company’s heavy reliance on volatile digital assets has investors seriously worried about what comes next.

Regulatory pressure keeps mounting.

The SEC’s recent crackdown on unregistered crypto exchanges created massive uncertainty, while European regulators are exploring even tougher rules for digital asset trading. Evans sees the regulatory push as good news, arguing that “we welcome clear guidelines” because they’ll give cryptocurrencies more legitimacy in the long run. But shareholders aren’t buying it – they want answers at next month’s meeting about the company’s crypto strategy and diversification plans.

Strategy Inc. announced on February 10 that it’s reassessing its Bitcoin approach after the recent market chaos. CFO Sarah Thompson said they’re exploring ways to hedge against Bitcoin’s volatility, though she didn’t spell out specific strategies. The stock managed a slight recovery to $27.50 by February 9, but trading volumes stayed high, showing continued investor uncertainty about those massive crypto holdings.

The board called an emergency meeting for February 15 to evaluate how cryptocurrency market swings are hitting the company’s financial health. They’re also looking at potential changes to asset management policies, with board member David Lee mentioning a possible partial sale of Bitcoin holdings by March. “We’re evaluating all options to ensure sustainable growth,” Lee said, hinting that the company might finally diversify beyond crypto.

Wall Street analysts are taking notice. Morgan Stanley downgraded Strategy Inc. from “buy” to “hold” on February 13, citing the firm’s crypto exposure as a major risk factor. The company also partnered with Greenfield Advisors to explore alternative investments beyond cryptocurrencies, with Thompson stressing the need to diversify the asset portfolio and stabilize performance amid all this market turbulence.

The upcoming shareholder meeting on March 5 can’t come soon enough for nervous investors. They’re desperate to hear how Strategy Inc. plans to navigate these choppy waters and whether the company will stick with its Bitcoin-heavy strategy or finally pivot to safer ground. With regulatory investigations ongoing and no formal communication from authorities about the firm’s crypto investments, Strategy Inc. finds itself in a waiting game that’s costing shareholders millions.

The SEC hasn’t provided any comment on its ongoing crypto investigations.

Strategy Inc.’s crypto troubles mirror a broader corporate retreat from Bitcoin treasuries that started gaining momentum in late 2025. Tesla sold 75% of its Bitcoin holdings last quarter, while Square reduced its position by 40% amid similar volatility concerns. MicroStrategy, once the poster child for corporate Bitcoin adoption, saw its shares lose 35% of their value over the past six months as institutional investors grew wary of crypto-heavy balance sheets.

Market data shows that companies with significant Bitcoin exposure have underperformed the S&P 500 by an average of 18% this year. Goldman Sachs analysts estimate that roughly $12 billion in corporate Bitcoin holdings across 47 publicly traded companies could face further pressure if regulatory uncertainty persists. Meanwhile, venture capital firm Andreessen Horowitz reduced its crypto fund allocations by 30% in January, signaling that even crypto-native investors are becoming more cautious about digital asset volatility in corporate portfolios.