Key Takeaways
Why is Bitcoin’s low volatility bad for Saylor’s leverage?
It reduces the demand for convertible debt used by Strategy to buy more BTC.
How could this affect the value of BTC?
According to Coinbase analysts, this could lead to near-term caution.
The Bitcoin [BTC] the price has become less volatile lately, which could impact Strategy (formerly MicroStrategy). In fact, the 90-Day Volatility Index (which tracks price movements over a 90-day period) fell to a record low in 2025.
Experts have linked the reduced price volatility to the increasing industrialization of assets through ETFs (exchange traded funds) and corporate bonds.
How will Saylor’s strategy affect the value of BTC?
Unfortunately, the low volatility trend could also impact Michael Saylor’s BTC purchasing plans. noted analyst Alex Kruger.
“The decreasing volatility makes these options (embedded in convertible debt) less valuable, forcing MSTR to offer less favorable terms, which hinders the company’s ability to scale Bitcoin holdings.”
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He added that the “era of MSTR” driving BTC higher is over.
Strategy (MSTR) has traditionally relied on convertible debt and equity offerings to finance BTC purchases. When volatility was high, the embedded call options in those convertible bonds rose in value, giving Strategy cheaper leverage to accumulate BTC.
But the muted volatility would do the opposite and impact one of Strategy’s capital raising plans for BTC purchases.
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If the trend continues, the company may be left with stock issues to fund subsequent BTC purchases.
But so does the mNAV (market net asset value) or relative value of the underlying BTC holdings decreased up to 1.1X. If the benchmark falls below 1, raising capital through stock sell-offs may also be disappointing. Overall, this could derail Strategy’s BTC buying spree.
Since the massive BTC overhaul of $21,000 in July, Strategy’s accumulation has also fallen in the second half of the year.
Demand for DAT decreases as Strategy accumulation stagnates
Source: CryptoQuant
In fact, Coinbase analysts warned that BTC demand from digital asset treasury companies (DATs) has been absent over the past two weeks and could impact BTC’s near-term recovery.
“DAT buying has not appeared for BTC and is narrowly concentrated for ETH, indicating some caution among major players following the deleveraging, even at current ‘support’ levels.”
Source: Coinbase
According to the attached chart, BTC DATs recorded significant demand in August.
Bids in September were marginal, while in October they all but disappeared. Retail players have indeed done that lost more than $17 billion on DATs.
As one of the biggest demand lines for BTC, alongside ETFs, DATs’ declining activity could be a short-term risk for the asset, Coinbase analysts said.
“We believe this warrants more cautious positioning in the short term, as the market appears more vulnerable when the largest discretionary balance sheets are sidelined.”
Meanwhile, BTC was trading at $111.6K at the time of writing, ahead of major macro updates including the Fed rate decision and the US-China rate meeting.