coindesk.com
Strategy (MSTR) has not purchased any bitcoin since June 22, when it acquired just 520 $BTC for approximately $35 million. Since then, the company has shifted its immediate focus from bitcoin accumulation to strengthening its liquidity position.
During the week ending July 5, Strategy sold 3,588 $BTC in two transactions. It sold 1,363 $BTC for approximately $80.8 million on June 30, followed by another 2,225 $BTC for $135.2 million. The sales generated roughly $216 million and reduced Strategy’s holdings to 843,775 $BTC.
The company said the proceeds would help fund distributions on its preferred stock and replenish the portion of its U.S. dollar reserve used to make those payments. The reserve stood at approximately $2.55 billion following the sales.
On Monday, Strategy increased its U.S. dollar reserve to approximately $3 billion. Based on annualized preferred-stock dividends and debt interest of roughly $1.76 billion, the reserve now provides about 20.4 months of coverage.
This liquidity buffer should give Strategy sufficient flexibility to navigate an extended bitcoin downturn without being forced to sell significant amounts of bitcoin at lower prices or raise capital under unfavorable conditions.
If bitcoin follows its historical four-year cycle, a cyclical low could arrive later this year, potentially around October. However, this remains a scenario rather than a reliable forecast.
Expanding the USD reserve is also part of Strategy’s bitcoin monetization and capital-management framework. One objective is to reinforce the perceived creditworthiness of its perpetual preferred securities, particularly Stretch (STRC), by demonstrating that cash distributions can continue during periods of bitcoin weakness and can also sell up to $1.25 billion worth of bitcoin to fund the dividend payments.
STRC currently trades at approximately $87, down around 0.5% on Monday, although it has recovered from a late-June low near $70. Its continued discount to the $100 stated value suggests investors still require a higher yield to compensate for bitcoin-related and liquidity risks.
Meanwhile, MSTR’s multiple to net asset value (mNAV) on an enterprise basis is approximately 1.02, meaning the shares are trading at only a slight premium to the company’s net assets. Therefore the larger cash reserve gives Strategy more flexibility if the bear market persists and access to accretive equity financing remains limited.