A public debate has opened over whether Strategy, the world’s largest corporate Bitcoin holder, should sell part of its stash to shore up its finances, as its preferred stock slides further below par. On one side, Grayscale’s head of research says a multibillion-dollar Bitcoin sale is the cleanest way to restore confidence. On the other, prominent Bitcoiners argue the company’s capital structure is designed to repair itself without selling a single coin.
The Case for Selling: Grayscale’s $3 Billion Call
Zach Pandl, head of research at Grayscale, called on Strategy to liquidate at least $3 billion worth of Bitcoin to cover most of the company’s cash obligations over the next two years, arguing in a Saturday X post that the move could restore market confidence in its capital structure.
Pandl drew a sharp distinction between his hope and his expectation. While he would prefer the Bitcoin sale, he said he actually expects Strategy to instead raise the dividend rate on its preferred stock STRC by 50 basis points, adding roughly $100 million in annual obligations over two years, a scenario he described as one that “probably does not help market confidence.”
Strategy currently faces an annual preferred dividend obligation of approximately $1.2 billion, driven primarily by STRC. The stock, positioned as Strategy’s flagship “digital credit” preferred security, is designed to trade near its $100 par value. On Friday, STRC fell as low as $71.25, a 28.75% discount to par, while Strategy’s common stock MSTR closed the same day at $82.31, down 26.86% over the trading week.
Why the Cash Position Is Under Scrutiny
Strategy holds 847,363 BTC, placing its financing decisions under the industry’s microscope. Its latest 8-K filing with the US Securities and Exchange Commission showed the company increased its US dollar reserve by $300 million to $1.4 billion, leaving it with roughly 14 months of dividend coverage, a sharp contraction from what was previously a seven-year cushion. The company’s cash reserve is down 38% in 2026.
Blockchain analytics firm CryptoQuant flagged the deterioration in a report published Tuesday, arguing Strategy should pause Bitcoin purchases and focus on replenishing its cash reserves. The company said on Monday it intends to continue rebuilding its dollar reserves to support the credit quality of its digital credit securities.
The Case Against Selling: A Self-Repairing Structure
Not everyone agrees a sale is necessary. CryptoQuant itself noted that Strategy has no obligation to sell Bitcoin to support STRC’s price, and could instead raise the current 11.5% dividend yield to defend the stock without touching its treasury.
Bitcoin advocate Samson Mow went further, arguing in a Monday X post that STRC carries a built-in self-repairing mechanism. When the stock falls below its $100 reference price, Strategy halts new at-the-money share issuance, cutting off the supply of fresh shares. At the same time, the lower price mechanically boosts the yield for incoming buyers relative to what they paid, which Mow argued should attract fresh demand and gradually pull the price back toward par.
The two camps leave investors with a genuine question: whether Strategy must take decisive action to defend its credit structure, or whether the mechanics of that structure will stabilize it on their own.
