Finance

Citi Sees Bitcoin’s $181K Future: Should You Buy Strategy Stock Now?

Citi gave Strategy a “buy” rating, seeing Bitcoin upside, but warned of significant risk.

October 21, 2025, 9:21 PM

A screen displays a visually appealing illustration of cryptocurrency prices generated by artificial intelligence.

The fluctuating cryptocurrency price on a screen is artfully illustrated, showcasing the dynamic nature of digital finance. By MDL.

Executive Summary

Citi has issued a “buy” rating for Strategy stock (MSTR) with a $485 price target, based on its projection that Bitcoin could reach $181,000 within 12 months.

Citi explicitly warned of significant risks for MSTR investors due to the stock’s nearly 100% direct and leveraged correlation to Bitcoin’s volatile price, which can lead to magnified losses.

Strategy has become the largest corporate holder of Bitcoin, accumulating 640,418 Bitcoins since August 2020 as a core corporate treasury strategy.

The Story So Far

Strategy (formerly MicroStrategy) initiated a corporate treasury strategy in August 2020 to acquire and hold Bitcoin, becoming the largest corporate holder and thereby transforming its stock into a leveraged proxy almost entirely tied to the cryptocurrency’s volatile price, which offers investors direct exposure to Bitcoin but also presents magnified risks due to market fluctuations.

Why This Matters

Citi’s bullish rating on Strategy (MSTR) and its projection for Bitcoin’s price indicate a growing institutional belief in MSTR as a viable, albeit leveraged, proxy for cryptocurrency exposure, potentially influencing other corporate investment strategies. However, this endorsement is heavily tempered by an explicit warning regarding MSTR’s near-total correlation to Bitcoin, highlighting the magnified risks investors face from the volatile crypto market.

Who Thinks What?

Citi has issued a “buy” rating for Strategy stock, projecting Bitcoin could reach $181,000, while also cautioning investors about the significant risks associated with the stock’s direct correlation to the volatile cryptocurrency.

Strategy co-founder and chairman Michael Saylor champions Bitcoin accumulation, believing it generates superior returns for shareholders and serves as a beneficial corporate treasury strategy.

Experts consistently warn about the inherent risks of companies adopting cryptocurrency investment strategies due to the extreme volatility and speculative nature of these markets.

Citi has issued a “buy” rating for Strategy stock (Nasdaq: MSTR), setting a price target of $485 and labeling the investment as a “bellwether of BTC’s potential upside and downside momentum.” The financial institution, however, cautioned investors about the significant risks associated with the stock’s direct correlation to the volatile cryptocurrency. Strategy shares closed up 1.7% at $301.91 per share, while Bitcoin was recently trading at $111,490, down over 11% from its October all-time high of $126,080.

Rationale and Risks

The bank’s optimistic outlook is partly based on its projection that Bitcoin could reach $181,000 within the next 12 months. Citi’s analysis suggests that MSTR’s Net Asset Value (NAV) premium could range between 25% and 35%, aligning with the stock’s historical 2.5x-3.5x Bitcoin yield multiple, assuming sustained positive momentum for the cryptocurrency.

Despite the bullish rating, Citi explicitly warned that Strategy’s value is nearly 100% tied to Bitcoin, making it a leveraged proxy for the digital asset. This direct exposure means that even a moderate decline in Bitcoin’s price could lead to magnified losses for MSTR shareholders, presenting substantial risk.

Strategy’s Bitcoin Accumulation

Strategy, formerly known as MicroStrategy, began acquiring Bitcoin in August 2020. The company’s initial aim was to generate superior returns for shareholders amidst economic uncertainties during the COVID-19 pandemic, positioning itself as a corporate treasury strategy.

The firm has since become the largest corporate holder of Bitcoin, with current holdings of 640,418 Bitcoins, valued at approximately $71.6 billion. Strategy co-founder and chairman Michael Saylor has consistently championed Bitcoin, highlighting its potential benefits for corporations.

In its most recent acquisition, Strategy spent $18.8 million to purchase 168 Bitcoins last week. This transaction, funded by proceeds from preferred shares, further bolstered the Tysons Corner, Virginia-based firm’s substantial Bitcoin stockpile.

Market Context and Expert Warnings

Strategy’s business model allows investors to gain exposure to Bitcoin by purchasing its shares. This approach has prompted other companies to invest in Bitcoin, Ethereum, and other digital assets in an effort to boost their stock performance.

However, experts have consistently warned about the inherent risks of such strategies. They argue that this model may not be suitable for every company due to the extreme volatility and speculative nature of cryptocurrency markets.

Key Takeaways

Citi’s “buy” rating for Strategy underscores a belief in Bitcoin’s potential upside, with a $485 price target for MSTR. However, the bank concurrently issued a strong caution regarding the stock’s direct and leveraged exposure to Bitcoin’s price fluctuations, emphasizing the magnified risks for investors.