Strategy Sells $216mn of Bitcoin as Dividend Funding Test Deepens

Michael Saylor, Strategy's co-founder and executive chair, said on 6 Jul that the company sold the bitcoin to fund dividends and held 843,775 BTC as of 5 Jul, alongside $2.55bn in USD reserves. A Securities and Exchange Commission (SEC) filing showed the sales in two stages: 1,363 BTC between 29 Jun and 30 Jun for $80.8mn, and 2,225 BTC between 1 Jul and 5 Jul for $135.2mn.

Bitcoin fell to a session low near $61,400 at 13:30UTC after the disclosure, down from about $62,400 beforehand and an early-session peak near $63,900. Strategy shares were up slightly at the New York open at around $97, but almost 3% below Thursday's $100.77 close.

The sale is trivial against daily Bitcoin turnover measured in tens of billions of dollars, so the drop read as a verdict on the signal rather than the flow: the largest corporate holder is now a repeat seller. The pattern echoes Strategy's first sale in late May, a negligible 32 coins that still preceded weeks of weakness. Analysts have tied Bitcoin's broader slide since its October peak to fading momentum, ETF outflows and rotation into gold and AI equities rather than Strategy's selling, but each disclosure now lands on an already-fragile tape.

The sale follows Strategy's capital-structure overhaul last week, when the company introduced a Bitcoin Monetization Program, part of a wider Digital Credit Capital Framework. The $1.25bn figure that drew most attention is narrower than it looks: it caps only the bitcoin Strategy may sell to build its USD reserve. The same programme separately authorizes uncapped bitcoin sales to fund preferred dividends and interest, or to repurchase preferred and common shares, whenever management judges a sale more advantageous than issuing stock. In effect, the board has granted standing permission to sell as much bitcoin as it chooses for those purposes without returning for approval.

The framework was welcomed by investors, as it gave Strategy more flexibility after its mNAV, the ratio of its market value to the worth of its bitcoin, fell below one, and STRC, its variable-rate preferred stock designed to trade near $100, slid far below that reference value.

Dividends drive BTC sales

Saylor said the proceeds funded quarterly dividends on the STRF, STRE, STRK and STRD preferred series, as well as the full monthly June dividend on STRC.

STRC has become a central stress point in the funding model, its dividend adjustments used to support demand. It fell as low as $71.25 intraday on 22 Jun, roughly 29% below par, raising concerns over whether preferred stock could keep supporting Strategy's Bitcoin acquisition strategy.

Strategy raised the STRC dividend rate by 50 basis points to 12% for its July dividend and said its corporate objective is for STRC to trade over time at $99 to $100. The latest sale shows the cost of holding that capital structure together when preferred dividends remain due and market prices are under pressure.

Market weighs new model

The move tests the market's positive reaction last week, when investors sent MSTR and STRC higher after Strategy introduced its capital plan. Markets appeared to favour added liquidity, buyback capacity and dividend coverage over a strict "never sell" Bitcoin stance. Bitcoin's slide as the first sale under that plan landed suggests the welcome may be wearing thin.

The trade-off is now explicit. Strategy still holds more Bitcoin than any other public company, but that Bitcoin is now an active funding tool: a treasury no longer solely about accumulation, but about defending the preferred securities built on top of it.

(This article was corrected to clarify that the $1.25bn cap under Strategy's Bitcoin Monetization Program applies only to funding its USD reserve; the program separately authorizes uncapped bitcoin sales to fund dividends, interest and buybacks.)