Original title: How Jim Chanos outplayed Michael Saylor: short MSTR, long BTC

Original author: Proto Staff

Original translation by Peggy, BlockBeats

Editor's Note: While Strategy has turned "holding Bitcoin through a company" into a belief, Jim Chanos has chosen to bet in the opposite direction: shorting MSTR and going long on BTC.

Seemingly divergent, yet essentially the same: both are exploiting structural biases in the market, one leveraging conviction, the other defusing the bubble with rationality. In this contest over valuation and liquidity, faith and skepticism are not clearly distinct, but rather two choices that reflect each other.

The following is the original text:

Jim Chanos, a well-known "cynical" investor on Wall Street, has closed out his highly publicized and controversial short-selling trade against Michael Saylor's Strategy—it is speculated that he made a profit of approximately 100% by shorting the company's common stock, MSTR.

More precisely, this well-known short seller established a paired trade: shorting MSTR while going long on Bitcoin (BTC).

He wasn't betting on an absolute drop in MSTR's share price in dollar terms, but rather on a contraction in MSTR's premium relative to BTC.

Strategy is one of the world's largest digital asset treasuries (DATs), publicly traded companies that acquire crypto assets through financial leverage rather than relying on the sale of traditional products or services to generate revenue. The company currently holds approximately $66 billion in Bitcoin (BTC), with an enterprise value of approximately $84 million (market capitalization plus pro forma net debt including preferred stock), representing a premium of 1.27 times its net asset value (mNAV).

However, since Chanos established his position, this mNAV has declined significantly.

He initiated this two-legged trade in November 2024 to express his skepticism that MSTR was underperforming Bitcoin; as of last Friday morning, Chanos and his company Chanos & Co. had closed out all their positions, with a paper profit of approximately 100%.

Chanos's "victory parade" photos posted on social media have sparked a heated discussion, with the post receiving over 1 million views.

Short MSTR, go long BTC

Chanos’s gains primarily came from a decline in MSTR’s net asset multiple (mNAV).

In November 2024, the multiple was once above 3 times; by December of the same year, when he explained his investment rationale at the annual meeting, the average level had dropped to about 2.5 times. When he closed out his entire position, MSTR's mNAV had fallen to 1.23 times—meaning that the company's stock price was only 23% higher than its Bitcoin holdings.

Meanwhile, another part of his trades is also rising. Since November 2024, the price of Bitcoin has increased by about 25%. In other words, Chanos not only doubled his money by shorting MSTR, but also earned about 25% profit from the rise in Bitcoin.

Profiting from both sides has cemented this family office fund manager's position as "Saylor's most successful critic."

Imitate Strategy, surpass Strategy

Chanos was immediately attacked by Saylor supporters, including community members who called themselves "Irresponsibly Long MSTR," after publicly expressing a bearish view on Strategy at the 2025 Sohn Investment Conference in New York.

In numerous television interviews and social media appearances, Chanos has emphasized that his bearish view stems from the fact that Strategy's high net asset multiple (mNAV) is unlikely to be sustained in the long term.

He once described his trading strategy as: "Sell MicroStrategy stock and buy Bitcoin—basically buy something for $1 and sell it for $2.50." He also bluntly criticized Saylor's leveraged Bitcoin purchase as "utterly absurd" and "pure financial nonsense."

In fact, Chanos believes that his trading logic is essentially imitating Saylor himself: sell MSTR and use the profits to buy Bitcoin.

Chanos has repeatedly pointed out that Strategy's actions of continuously diluting its own equity and selling MSTR in order to buy more BTC were the key incentive that prompted him to create this two-legged trade (shorting MSTR and going long on BTC).

Although Strategy has also raised billions of dollars through the issuance of preferred stock (which will not directly dilute MSTR's equity for the time being), most of its funding still comes from the sale of MSTR stock.

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