Jack Mallers, Strike founder and Twenty One Capital CEO, stated that Bitcoin trading below $63,000 reflects a global liquidity crisis rather than sentiment issues, speaking at BTC Prague this week. Mallers attributed the decline from above $100,000 a year ago to simultaneous pressures: nations funding wars, AI infrastructure, and deficit spending while individuals face late credit card and rent payments. Consumer sentiment as measured by the University of Michigan has reached its lowest point in recorded history—below 2008, 2000, and the 1980s—while the S&P 500 sits at an all-time high.
Mallers Frames Bitcoin Decline as Liquidity Signal
Mallers described Bitcoin as "the closest thing we have to the monetary reflection of truth" and an "active 24/7 traded indicator of how the world is doing." He characterized current selling pressure as a cash-raising mode where entities liquidate the most liquid assets available. "You sell what you can, not what you want," Mallers said.
Strategy Sold 32 Bitcoin, Then Purchased 1,550 BTC
Strategy sold 32 bitcoin last week—its first sale since late 2022—to fund distributions on its perpetual preferred stock. Mallers stated the move was about conditioning markets to accept that the company's "never sell" posture is no longer operationally tenable. Strategy subsequently purchased 1,550 BTC the week after, as The Block reported.
Mallers Questions Strategy's Perpetual Preferred Structure
Mallers said he has gone on record with questions about Strategy's perpetual preferred instruments. The company now carries four classes of claimants: bitcoin, common equity, perpetual preferred stock, and debt holders. The perpetual preferreds are non-callable and carry an 11.5% coupon, creating what Mallers described as a permanent liquidity obligation with no natural exit.
Mallers outlined three options for meeting preferred holder obligations: selling bitcoin (which damages bitcoin holders), selling common equity (which disadvantages common shareholders), or declining to pay preferred holders entirely. "How do you make the whole capital stack happy?" Mallers asked.
Mallers said the public exchange with Saylor at BTC Prague was not premeditated. He had raised questions about mNAV and dilution on a panel earlier in the day, left the venue, and received a message that Saylor had responded from the stage and invited him back. "I have plenty of conversations with Michael," Mallers said. "Go to dinner all the time."
Mallers added that he has not used perpetual preferred instruments at any company he has founded, citing his own incomplete understanding of their long-term dynamics.
Strike's Bitcoin-Backed Lending Outperforms Other Products
Strike's revenue is on track to grow year-over-year, though new user registrations and active bitcoin buyers have declined, Mallers said. Bitcoin-backed lending has outperformed every other product Strike has launched. Mallers estimated the total CeFi bitcoin-backed lending market at between $20 billion and $30 billion against a $1.25 trillion asset class.
Strike recently launched a no-liquidation loan option, under which borrowers pay a slightly higher fee and Strike uses the premium to hedge, eliminating forced liquidation risk entirely. The company is introducing quarterly proof-of-reserve audits and segregated collateral for high-value clients.
Mallers declined to discuss Twenty One Capital or the proposed Tether-backed merger with Strike and Elektron Energy, citing public-company legal constraints.
FAQ
What did Jack Mallers say about Bitcoin trading below $63,000?
Jack Mallers stated that Bitcoin trading below $63,000 reflects a global liquidity crisis rather than sentiment issues. He described Bitcoin as "the closest thing we have to the monetary reflection of truth" and attributed the decline to simultaneous pressures from nations funding wars, AI infrastructure, and deficit spending while individuals face payment difficulties.
Why did Strategy sell 32 bitcoin last week?
Strategy sold 32 bitcoin last week—its first sale since late 2022—to fund distributions on its perpetual preferred stock. Jack Mallers stated the move was about conditioning markets to accept that the company's "never sell" posture is no longer operationally tenable. Strategy subsequently purchased 1,550 BTC the following week.
What bitcoin-backed lending features did Strike recently launch?
Strike recently launched a no-liquidation loan option, under which borrowers pay a slightly higher fee and Strike uses the premium to hedge, eliminating forced liquidation risk entirely. The company is also introducing quarterly proof-of-reserve audits and segregated collateral for high-value clients.
