Jim Chanos closes his MSTR short as Bitcoin stabilizes. Strategy holds 641K BTC worth $65.4B, signaling accumulation amid market volatility.
Author: Chirag Sharma
November 8, 2025 , In a dramatic twist for both Wall Street and crypto watchers, legendary short-seller Jim Chanos has closed his long-running bearish position against Strategy Inc. (NASDAQ: MSTR), formerly MicroStrategy. The move follows a brutal 20% sell-off in MSTR stock last week mirroring Bitcoin’s dip below $100,000 and could signal a pivotal sentiment shift for the Bitcoin proxy stock. Chanos, best known for exposing Enron, had run a hedged short long BTC, short MSTR since late 2024, betting that the stock’s premium to its Bitcoin holdings would collapse. With that premium now nearly erased, his exit has sparked fresh talk of a short squeeze and potential Bitcoin rebound, as MSTR remains deeply tied to the crypto’s trajectory.
Once seen as the “leveraged Bitcoin ETF”, Strategy’s stock has sharply corrected.
MSTR closed at $246.99 on November 4, down 6.7% on the day and 20% for the week, marking a seven-month low. The drop came after Bitcoin briefly dipped under $100K, sparking panic across both markets.
Investors cite Strategy’s debt-funded BTC purchases — including 397 BTC ($45.6M) bought on November 3 — as a red flag amid rising interest costs. The firm’s NAV multiple, once a lofty 3.3x, now sits at 1.07x, nearly parity with Bitcoin.
Credit concerns are also weighing: S&P Global maintains a “junk” rating on Strategy’s debt, and a potential $183 liquidity threshold looms if MSTR’s price slips further. Yet, no forced sales of BTC are confirmed.
As one analyst put it: “MSTR’s decoupling from Bitcoin is fear-driven, not fundamental.”
Chanos’ decision to unwind his short is fueling speculation of a potential short squeeze.
He entered the trade in November 2024, when MSTR traded at a 2.5x premium to its Bitcoin value. His hedged long-BTC, short-MSTR position earned steady returns as that premium collapsed through 2025.
The tweet ignited chatter across crypto circles, recalling a similar exit in 2023 that preceded a three-day 100% rally in MSTR.
With short interest still above 20%, some analysts see room for explosive upside if BTC rebounds.
“Chanos covering is often the canary in the coal mine for reversals,” noted Pierre Rochard.
Skeptics, however, caution that it could simply mark prudent profit-taking — not necessarily conviction in Bitcoin’s next move.
Despite market pressure, Strategy has continued accumulating Bitcoin every month.
The firm’s latest SEC filings show 641,205 BTC held as of November 2025 — an increase of over 202,000 BTC year-to-date. The firm’s total spend stands near $42B, with unrealized gains topping $21B at current prices.
(Based on SEC and company disclosures)
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