CryptoQuant analyst Maartunn said Strategy’s Bitcoin reserves can cover about 32 years of preferred-share dividends at current prices, but that figure depends on Bitcoin holding up. If the company has to sell BTC to meet those payments, the selling itself could weigh on the market and reduce the value of the reserves backing those obligations.
The risk is circular. Lower Bitcoin prices would shrink the reserve base, which would in turn reduce the dividend coverage period. If more BTC then has to be sold to keep paying dividends, the pressure could feed on itself. Maartunn said that setup carries the risk of turning into a downward spiral.
Sale of 32 BTC broke the long-standing no-sale stance
Between May 26 and May 31, Strategy sold 32 BTC at an average price of about $77,135 per coin, using the proceeds to pay dividends on its STRC preferred shares. According to the source material, this was the first time the company had broken its four-year policy of buying Bitcoin without selling it.
The balance-sheet strain comes from cash levels versus annual obligations. After repurchasing about $1.5 billion of convertible debt, Strategy’s cash position fell to roughly $900 million, while annual preferred dividend obligations stand at about $1.7 billion. On that basis, available cash does not cover a full year of dividend payments.
STRC fell to $88.9 and raised new financing concerns
Pressure is also building in STRC, formally known as the Variable Rate Series A Perpetual Stretch Preferred Stock. It was designed to trade near its $100 par value, with an annualized dividend rate of about 11.5% and monthly rate adjustments intended to keep the price close to that level.
That mechanism has not held in recent trading. STRC at one point closed at $88.9, a recent low, and below its $90 per share issue price from July 2025. A discount of that size suggests investors are demanding a higher yield and are becoming less confident in the stock’s credit profile and dividend stability.
Buying more Bitcoin may become harder
That matters because STRC has been part of Strategy’s fundraising engine for buying more Bitcoin. If the preferred stock trades well below par, issuing more shares becomes less attractive and more expensive, weakening the company’s ability to keep using that financing route.
Even so, Strategy has continued to add to its holdings. The source says the company bought 1,550 BTC on June 8 for about $101 million, lifting total holdings to 845,256 BTC. In response to market criticism, Strategy has pointed to its claim that Bitcoin reserves still cover roughly 32 years of dividends at current prices, while Michael Saylor said on X that the goal is to make STRC “the best credit instrument in the world.”
The central issue is that the 32-year figure is a static calculation based on the current Bitcoin price. If BTC falls, that runway gets shorter, and STRC’s break from its intended trading level has already pushed the market to reassess how durable the structure really is.