$4.85 Billion Says Saylor Is Wrong
Strategy, the company that has made buying Bitcoin its entire corporate identity, is now the most shorted large-cap stock in the United States. As of February 25, 2026, the net short position in MSTR has reached $4.85 billion, representing approximately 11% of the company's total market capitalization, according to data compiled by Goldman Sachs.
Among all U.S. stocks valued over $25 billion, Strategy now leads the short interest table with 14% of its publicly available shares sold short. For context, Coinbase ranks fourth at 11%. A year ago, MSTR was not even in the top 50.
The stock closed Monday at $124.61. The average analyst price target sits at $254, more than double the current price. That gap between Wall Street's published forecasts and the market's actual positioning is as wide as it has ever been.
The Big Short Joins the Pile
The headline name in the MSTR short book is Steve Eisman, the investor immortalized in "The Big Short" for predicting the 2008 financial crisis. Eisman disclosed his short position in Strategy in recent weeks, and the symbolism is hard to miss. The man who bet against American housing is now betting against the biggest corporate Bitcoin treasury ever assembled.
Eisman's broader thesis centers on economic fragility outside of artificial intelligence. He has publicly stated that the U.S. economy "is not even growing, really, 50 basis points outside of AI." In that framework, a company leveraged entirely to a single volatile asset, funded by preferred stock paying junk-bond yields, looks like a textbook short.
Short sellers are not operating on faith. They earned over $3.2 billion in profits from MSTR positions last year, making it the single most profitable short in the market. The playbook is proven, the conviction is backed by realized gains, and the capital is flowing in faster than at any point in Strategy's history as a Bitcoin proxy.
717,722 BTC at an Average of $76,020
Strategy's position has not changed through the bear market. Michael Saylor completed his 100th Bitcoin purchase announcement on February 23, adding 592 BTC for $39.8 million at an average of $67,286 per coin. Total holdings now stand at 717,722 BTC acquired for a cumulative $54.56 billion. The average cost basis is $76,020 per coin.
With Bitcoin trading near $66,000 at the time of writing, the entire position is underwater by approximately $10,000 per coin, translating to roughly $7 billion in unrealized losses across the portfolio. The stock has fallen 63% over the past six months and more than 50% year-over-year, underperforming Bitcoin itself during the same window.
The problem for shorts is that Saylor shows no indication of slowing down. He bought through the crash. He bought through the ETF outflows. He bought through 12 consecutive weeks of negative sentiment. The 100th purchase was not a victory lap. It was a statement of intent.
The Crowded Trade Argument
Fundstrat's Tom Lee has taken the opposite side of the Eisman trade. Lee argues that when a stock becomes "consensus short," it represents a crowded trade where the bearish thesis is already fully priced in. His position is that MSTR at current levels shows "signs of a meaningful low in place."
The mechanics support his case to a degree. With 14% of float shorted, any positive catalyst, whether a Bitcoin price recovery, a favorable regulatory development, or simply a quarter where the preferred dividends get covered without further dilution, could trigger forced covering. Short squeezes do not require the fundamental thesis to change. They require enough shorts to get uncomfortable at the same time.
But the counter-argument is equally structural. Strategy carries $8.2 billion in total debt with $6 billion due for refinancing in 2028. Annual preferred dividend obligations sit at $888 million. The company's legacy software business generates nowhere near enough revenue to service those obligations. Without Bitcoin price appreciation or continued access to capital markets, the math does not work. The shorts are not just betting against Bitcoin. They are betting against a capital structure that depends on perpetual optimism.
What MSTR's Short Interest Means for the Broader Crypto Market
Strategy owns roughly 3.4% of all Bitcoin that will ever exist. When shorts pile into MSTR, they are implicitly expressing a view on Bitcoin's price trajectory. If those shorts are correct and Bitcoin falls further, the consequences ripple well beyond one stock.
A Bitcoin drop below $60,000 would push Strategy's unrealized losses past $11 billion and potentially trigger conversations about covenant compliance, preferred dividend coverage, and the need for emergency dilution. That kind of forced selling, even the fear of it, could accelerate broader crypto market declines.
For holders of crypto cards and staking products, the MSTR short thesis is a proxy for the question that matters most: is the bear market deepening or bottoming? If Tom Lee is right and this is a crowded trade near a low, the next six months look very different than if Eisman is right and the leverage unwind has further to run.
The Bitcoin ETF outflow streak already showed institutional appetite cooling. The most shorted stock ranking confirms that some of the sharpest capital on Wall Street is actively positioned for further downside. At the same time, the $258 million in ETF inflows reported on Tuesday suggests the picture is not uniformly bearish.
The Squeeze or the Spiral
Two scenarios dominate the MSTR conversation. In the squeeze scenario, Bitcoin stabilizes above $65,000, Strategy continues buying without needing to issue preferred stock at punitive rates, and the 14% short interest becomes fuel for a violent rally. In the spiral scenario, Bitcoin drops below $60,000, Strategy's preferred dividend coverage becomes unsustainable, the company is forced to sell BTC or dilute further, and the selling pressure feeds back into Bitcoin's price.
The truth will likely land somewhere between these extremes. Saylor has survived worse. He took MicroStrategy through the dot-com crash, a $6 billion single-day market cap loss in 2000 that still ranks among the largest in history. He rebuilt. But he was not carrying $888 million in annual preferred dividends at the time.
The shorts are making a bet that the math eventually overwhelms the narrative. Saylor is making a bet that the narrative eventually overwhelms the math. At $4.85 billion in short interest versus 717,722 BTC in holdings, both sides have put their money where their conviction is.
FAQ
How much is shorted against Strategy right now? The net short position in MSTR is approximately $4.85 billion, representing about 11% of the company's market capitalization. Among large-cap U.S. stocks valued over $25 billion, Strategy leads with 14% of its publicly available shares sold short, per Goldman Sachs data.
Who is Steve Eisman and why does his MSTR short matter? Steve Eisman is the investor who famously predicted and profited from the 2008 housing crisis, depicted in the book and film "The Big Short." His disclosed short position in Strategy adds significant narrative weight because it signals that a high-profile risk analyst sees structural vulnerabilities in Saylor's Bitcoin treasury model.
Could a short squeeze send MSTR higher? With 14% of float shorted, MSTR is technically vulnerable to a short squeeze if a positive catalyst forces bearish traders to cover simultaneously. Tom Lee of Fundstrat has argued the crowded short position shows "signs of a meaningful low." However, squeezes are temporary and do not resolve the underlying debt and dividend obligations that shorts are betting against.
How much Bitcoin does Strategy hold? As of February 23, 2026, Strategy holds 717,722 BTC purchased for a total of $54.56 billion at an average cost of $76,020 per coin. At current prices near $66,000, the position carries approximately $7 billion in unrealized losses.
Overview
Strategy has become the most shorted large-cap stock in the United States, with $4.85 billion in net short interest representing 14% of its publicly available shares. Steve Eisman, the investor behind "The Big Short," has disclosed a position against the stock. Short sellers earned $3.2 billion from MSTR positions last year. Meanwhile, Michael Saylor completed his 100th Bitcoin purchase, bringing total holdings to 717,722 BTC at a $76,020 average cost, roughly $7 billion underwater at current prices. The debate centers on whether the crowded short trade signals a bottom or whether Strategy's $888 million annual preferred dividend obligation and $8.2 billion debt load will eventually force capitulation. Both sides have billions on the line.
Recommended Reading
- Michael Saylor Signals Strategy's 100th Bitcoin Buy While Sitting on 717,131 BTC and a 72 Percent Stock Collapse
- Bitcoin ETFs Shed $3.8 Billion in Five Weeks as IBIT Drives the Longest Outflow Streak
- BitMine Immersion Spent $16.4 Billion on Ethereum and Is Now Sitting on $8 Billion in Unrealized Losses
