Bitcoin needs new buyers to build a more durable floor after Strategy’s first BTC sale in nearly three years exposed limits in the company’s ability to keep adding to its holdings, according to Grayscale Research head Zach Pandl.
In a note published Thursday, Pandl said Strategy’s leveraged model is no longer acting as a reliable source of support for the market and is instead becoming a point of strain. Earlier this week, the company disclosed that it sold 32 BTC for about $2.5 million at an average price of $77,135, cutting its holdings to 843,706 BTC. The move broke with a no-sale posture that had been in place since December 2022.
The sale was small, but the signal mattered
Pandl described the transaction as minor relative to Strategy’s total position, yet said the shift in treasury management hurt market sentiment at a time when geopolitical uncertainty had already unsettled traders. For weeks, the market had been pricing in a meaningful chance that Strategy would sell some Bitcoin before year-end. Once that happened, the assumption that had shaped how traders viewed the company’s balance sheet no longer held.
The issue, in his view, was not the size of the sale alone. It was what the sale implied. Strategy has long been treated as a structural net buyer of BTC, and any sign that this role is changing forces the market to reassess how much support the company can still provide. A small trade can do that. This one did.
Funding pressure builds as STRC trades below par
The strain comes from Strategy’s variable-rate perpetual preferred stock, Stretch, which trades under the ticker STRC. The instrument was designed to trade near $100 per share while paying an 11.5% dividend. STRC is now around $95.42, with total notional close to $10.5 billion. Trading below par forces the company to raise its dividend, increasing cash flow obligations linked to a Bitcoin-backed balance sheet.
That matters because STRC has funded much of Strategy’s recent buying activity. The company used at-the-market sales of preferred and common stock to finance a roughly $2 billion Bitcoin purchase. That structure depends on both STRC and MSTR retaining enough value. If prices in either security weaken, Strategy’s room to accumulate more tokens narrows.
Pandl said the company’s levered business model is under pressure and that this has raised volatility for the BTC market as a whole. At current prices for STRC and MSTR, he said, Strategy’s ability to keep accumulating more Bitcoin looks limited.
Grayscale prefers a broader base of Bitcoin holders
Pandl said a sustainable bottom in Bitcoin will require other buyers to step in. Grayscale still takes a constructive view of the longer-term setup, but with a different market structure. The firm argues that resilience would improve if less Bitcoin sat on leveraged treasury balance sheets and more were held across a wider set of corporate treasuries.
That stands in contrast to the pattern of recent years, when a single leveraged proxy concentrated exposure into a feedback loop. Grayscale expects Bitcoin to recover in the coming months, while warning that it may underperform segments that benefit more directly from near-term regulatory clarity.