Strategy Authorizes $1.25 Billion Bitcoin Sale Program, Rebuilds Cash Reserves to 25.9 Months of Coverage
Strategy announced a formal Bitcoin monetization program on June 29, 2026, authorizing the company to sell up to $1.25 billion worth of Bitcoin to fund its USD reserve, pay preferred stock dividends and interest, and repurchase its own securities. The announcement, which the company packaged under a broader Digital Credit Capital Framework, marks the first time Strategy has codified conditions under which it will sell Bitcoin rather than buy it.
WHAT THE FRAMEWORK ACTUALLY DOES
The core of the announcement is a rebuilding of financial cushion. Strategy raised its USD reserve to $2.55 billion as of June 28, 2026. That reserve is designated solely for preferred stock dividends and interest expense, subject to a board policy requiring a minimum of 12 months of coverage. At current run-rates of roughly $1.76 billion annually, the $2.55 billion provides approximately 17.4 months of coverage.
Combined with the board-authorized Bitcoin monetization capacity, Strategy has approximately 25.9 months of current preferred stock dividend liquidity coverage. That figure matters because it restores and exceeds the roughly two-year cushion the market had grown comfortable with before a recent bond buyback drained reserves to around seven months and rattled investors in the STRC preferred stock product.
The annual dividend rate on STRC preferred stock rises to 12% from 11.5%, alongside buyback authorizations for both preferred securities and Class A shares. Strategy also established repurchase programs for up to $1 billion of its digital credit securities and up to $1 billion of MSTR common stock, to be used during market dislocations.
THE CFO'S FRAMING
CFO Andrew Kang framed the program directly: "Bitcoin is capital. This program gives Strategy the flexibility to use a portion of its BTC Reserve to strengthen Digital Credit, fund or replenish the USD Reserve, fund dividend payments and interest expense, and fund accretive repurchases when BTC monetization is more advantageous than issuing common equity."
Executive Chairman Michael Saylor stated: "Strategy remains committed to Bitcoin as its primary treasury reserve asset. At the same time, Digital Credit requires liquidity, discipline, and active capital management. This framework is designed to strengthen credit quality and enable the Company to reduce expected preferred stock dividend payments when accretive. This framework also sets out how we plan to use our capital management toolkit while maintaining our commitment to long-term Bitcoin exposure."
WHAT BITCOIN HOLDERS ARE WATCHING
The program does not obligate Strategy to sell any Bitcoin. Any sales are subject to market conditions, liquidity needs, tax and accounting considerations, and management's assessment of long-term shareholder value. The company expects to disclose material BTC monetization and other capital markets activity through standard Form 8-K filings.
The hard number that has Bitcoin-focused observers on alert is the 21,000 BTC that would be implied by a full $1.25 billion sale at current prices near $60,000. Strategy has not announced any sale, and its holdings currently stand at 847,363 BTC. The program is a ceiling, not a schedule. Whether Strategy becomes a net seller even in a single week, let alone over the life of the program, depends entirely on whether cash reserves can be maintained through other means.
MARKET REACTION
MSTR stock surged almost 7% pre-market following the news. STRC, the preferred stock product that had fallen from near par to around $72, rebounded sharply toward the $80s on the announcement, a sign that investors read the move primarily as a liquidity strengthening rather than a capitulation on the Bitcoin thesis.
The two moves that spooked the market over the prior two weeks, a large bond buyback that cut reserves to seven months and perceived dilution of common shareholders, have both been directly addressed. Strategy signaled it will not fund repurchases from the USD reserve, and it committed to buying back MSTR when the stock trades at or near 1x mNAV. For holders of both tickers, the announcement is a course correction that does not change the company's long-term Bitcoin orientation but formally acknowledges that running a leveraged preferred stock product requires more active treasury management than simply stacking coins.
