Citi has given Strategy stock a “buy” rating and a price target of $485, citing the investment as “a bellwether of BTC’s potential upside and downside momentum.”

The bank said in a Tuesday note that Bitcoin treasury, which trades on the Nasdaq under the ticker MSTR, could continue to soar if BTC hits the $181,000 12-month price target it gave the company last week. 

MSTR closed up 1.7% at $301.91 per share, according to Yahoo Finance data. The stock’s record price was $473.83 in 2024. Bitcoin was priced at $111,490, down over 11% from its October all-time high of $126,080, according to CoinGecko data. 

“Our view that MSTR’s NAV premium can range 25%-35%, in line with the stock’s historical 2.5x-3.5x Bitcoin yield multiple assuming continued positive momentum for Bitcoin,” the note read. 

But the bank warned: “The stock presents significant risks due to its positioning as a leveraged proxy for Bitcoin. Its value is nearly 100% tied to the sometimes-volatile cryptocurrency, meaning that even a moderate decline in Bitcoin’s price can lead to magnified losses for MSTR shareholders.”

Strategy—formerly MicroStrategy—started buying Bitcoin in August 2020 as a way to generate better returns for its shareholders as inflation rocked the U.S. and world economies during the COVID-19 pandemic. 

It is now the largest corporate holder of the asset, focusing mostly on securitizing Bitcoin. Its business model works so that investors can buy its shares to gain exposure to the leading cryptocurrency by market capitalization.

The company now holds 640,418 Bitcoins—or $71.6 billion in digital coins—and Strategy co-founder and chairman Michael Saylor frequently praises the asset and its potential to benefit corporations. 

Other companies have followed Strategy’s approach, buying Bitcoin, Ethereum, and other digital coins to boost their stock prices. But some experts have warned of the strategy’s inherent risk, and that it might not be appropriate for every company.