Update, June 24, 2026, 2:14 pm UTC: This article was updated to include Strategy’s MSTR shares trading below $100 for the first time since March 1, 2024, according to Yahoo Finance data.
After Strategy’s dividend coverage fell to 14 months from seven years, CryptoQuant said the company led by Michael Saylor should pause Bitcoin purchases and focus on replenishing its cash reserve, which is down 38% year-to-date.
Strategy’s dividend obligations have nearly quadrupled to $1.2 billion, as the company issued substantial new STRC preferred stock, which carries an 11.5% yield.
“They should pause Bitcoin purchases, rebuild cash reserves, and adopt a systematic framework for purchase timing,” wrote the market data analytics provider’s CEO Ki Young Ju in a Wednesday X post, adding that the biggest public Bitcoin treasury holder should also create a “disciplined selling framework” for the next bull market.
Strategy’s cash reserve fell 38% after the company repurchased $1.5 billion of its 2029 senior notes at a discount, Cointelegraph reported on May 26. Those coffers have since recovered to $1.4 billion after it sold $335.5 million in MSTR shares, which added $300 million to its US dollar reserve on Monday, although it is near a record-low of 14 months’ of funds available to pay dividends.
STRC preferred shares hit by BTC correction
Strategy’s income-generating preferred stock, STRC, fell to $82.50 last week, a record 17.5% below its $100 par value. CryptoQuant’s report attributed it to the Bitcoin bear market correction and the “simultaneous depletion” of its cash reserve.
STRC is one of Strategy’s main mechanisms to fund its Bitcoin accumulation. Trading below par limits Strategy’s ability to raise funds through STRC sales. It may also force the company to increase its nominal dividend rate to attract buyers and protect STRC’s price.
The company said it plans to “continue replenishing” its USD reserve to “support the credit quality of its Digital Credit securities,” according to a Monday X post.
Cointelegraph’s request for comment on Strategy’s plans to replenish the cash reserve and whether this could help STRC’s price recover was not immediately replied to by the company.
Strategy cash reserve and dividend coverage in months. Source: CryptoQuant
No obligation to sell Bitcoin to support STRC price
CryptoQuant said Strategy is not “obligated” to sell Bitcoin to maintain STRC’s price, as the company can also deploy other tools to defend the stock, such as raising the current 11.5% dividend yield or issuing MSTR stock to “signal its ability to continue paying dividends,” adding:
“However, the path back to $100 is not straightforward.[…] Rebuilding the cash reserve to ~$2.8 billion (24 months of coverage) is a necessary condition for STRC to recover.”
Strategy’s Bitcoin holdings only provide a “limited emergency cushion,” as the company is sitting on about $10.6 billion in unrealized losses, meaning that a forced BTC sale at current rates would “crystallize large losses and destroy shareholder value,” CryptoQuant said.
Related: Capital B shareholders approve up to $120B in financing capacity for Bitcoin strategy
Ahead of Wednesday’s Nasdaq market open, STRC shares were little changed after closing at $87.31 on Tuesday. That extended the preferred stock’s 12% decline in the past month, according to Yahoo Finance data.
STRC/USD, 1-month chart. Source: Yahoo Finance
Strategy’s common stock, MSTR, also traded below $100 in the pre-market on Wednesday for the first time since March 1, 2024, when it fell as low as $99.20, according to Yahoo Finance data.
CryptoQuant’s head of research, Julio Moreno, attributed STRC’s decline to a “deterioration in Strategy’s fundamentals,” including its falling dividend cash coverage caused by the depletion of its cash reserve and a fourfold increase in STRC’s annualized dividend obligations so far in 2026.
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