Strategy's latest statement comes amid increased volatility in its preferred stock price. The company disclosed that Executive Chairman Michael Saylor is publicly defending its Bitcoin treasury strategy, stating that the company's combined holdings of Bitcoin and U.S. dollar reserves exceed its debt by approximately $48 billion.
Compared to the stress period in 2022
The company disclosed that Strategy currently holds approximately 846,842 BTC, remaining the largest publicly traded company by Bitcoin holdings. According to recent filings submitted to the U.S. Securities and Exchange Commission, its average purchase cost for Bitcoin is approximately $75,656 per coin, while the reported spot price range for Bitcoin is between $62,500 and $63,700.
Saylor compared the current situation to the end of 2022, when Bitcoin fluctuated around $20,000, Strategy held approximately 130,000 BTC valued at about $2.6 billion. Subsequently, when Bitcoin fell below $16,000, the company’s debt briefly exceeded the combined total of its Bitcoin and cash reserves by approximately $300 million.
STRC has dropped below $100
Another point of market contention is the performance of STRC, the preferred shares issued by Strategy. This product, officially known as Floating-Rate Series A Perpetual Preferred Shares, is designed to trade around $100 and pay cash dividends to holders.
However, STRC has recently fallen into the $80 range. The company has repeatedly raised STRC’s dividend rate, bringing the annualized yield close to 11.5%, and adjusts the rate monthly to encourage the price to return toward par value. If STRC remains below $100 for an extended period, this financing channel will become less effective for continued Bitcoin purchases and dividend distributions.
Note that STRC is not directly collateralized by Bitcoin held by Strategy. Instead, it has a priority claim on the company’s remaining assets, making it more akin to a credit instrument than a product directly pegged to the price of Bitcoin.
Annual dividends of approximately $1.5 billion
Discussions around the strategy also focus on cash flow sustainability. The head of research at Grayscale stated on a podcast that this is more of a cash flow issue than a problem with the crypto assets themselves, as Bitcoin does not generate income, and preferred dividends require cash, refinancing, equity issuance, or asset sales to be paid.
The report states that Strategy’s various preferred stock instruments collectively carry an annual dividend obligation of approximately $1.5 billion, including STRC and STRK. In comparison, the company’s software business is expected to generate revenue of about $477 million in 2025, and its cash reserves of approximately $1 billion are insufficient to cover a full year’s preferred dividend payments.
In addition, Strategy recently sold 32 BTC at an average selling price of approximately $77,135 per BTC to support preferred stock dividends. This move has drawn attention because the company has long been known for consistently increasing its Bitcoin holdings. However, Saylor still emphasized that the company remains a clear net buyer overall.
Additional context: During a panel discussion at BTC Prague, Saylor stated that the hardest challenge for companies is not predicting the future, but surviving long enough to turn their judgments into reality. This long-term perspective is what he repeatedly emphasized while defending Strategy’s current capital structure.