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CryptoQuant, Grayscale warn Strategy’s dividend burden as MSTR falls below $100

CryptoQuant, Grayscale warn Strategy’s dividend burden as MSTR falls below $100

Strategy shares slid to $92, a two-year low, as Bitcoin fell below $60,000 and pressure grew on the company’s cash reserves, preferred funding model and unrealized BTC losses.

BTC

Fact Check
The original CryptoQuant X post directly states Strategy 'needs to stop buying Bitcoin and rebuild cash,' citing the 38% cash decline and dividend coverage collapse. The Block (primary reporting) and Cryptopolitan independently confirm the $1.5 billion convertible note repurchase, slumping STRC preferred shares trading below par, rising payout obligations rising to ~$1.2B, and the order-book data pointing to stronger spot buying interest. Every component of the claim is corroborated by the primary source and credible reporting.
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Summary

Strategy Inc. shares dropped more than 10% to about $92, a two-year low, as Bitcoin fell to roughly $59,000 and triggered a broader crypto-market liquidation wave. The move pushed Bitcoin below the average cost basis of Strategy’s purchases made in 2024, 2025 and 2026, widening the company’s unrealized paper loss. Strategy, which holds 847,363 BTC acquired at an average price of roughly $75,680 per coin, was estimated to be sitting on about $10.6 billion in unrealized losses in the latest account, though earlier estimates put the figure at more than $11 billion. The selloff deepened scrutiny of Strategy’s financing model. CryptoQuant research head Julio Moreno said annual dividend obligations tied to preferred instruments including STRC, STRK, STRF, STRD and STRE had risen from roughly $300 million at the start of 2026 to about $1.2 billion, while cash reserves had fallen 38% this year and dividend coverage had compressed to around 14 months. CryptoQuant said the company should rebuild cash reserves to roughly $2.8 billion before resuming Bitcoin purchases. Separately, Grayscale’s Zach Pandl has warned that Strategy’s larger preferred stack and dividend burden could eventually create a material cash-flow problem. Pressure has also shown up in the preferred shares. STRC was cited in the latest report trading near $84, below its $100 par value, after earlier reports said it had fallen as low as $81.83. Trading below par matters because it can weaken Strategy’s ability to raise fresh capital on attractive terms to fund more Bitcoin buying. The company’s stock was also described as trading at a discount to the value of its Bitcoin holdings, with mNAV around 0.80x in the latest report, compared with 1.1x in an earlier account, suggesting tighter constraints on both equity and preferred issuance. The renewed pressure followed Strategy’s sale of 32 BTC in early June, presented by the company as evidence it could meet dividend obligations through asset liquidation. Critics including Peter Schiff and NextGen Venture founder Jason Huang have argued that a deeper equity discount, lower preferred pricing or continued issuance could increase dilution or eventually create incentives to sell Bitcoin.

Terms & Concepts
  • preferred shares: A class of stock that usually pays set dividends and has priority over common shares in payouts.
  • mNAV: Market value relative to net asset value, used here to compare Strategy’s equity valuation with the value of its Bitcoin holdings.
  • liquidation cascade: A rapid wave of forced position closures that can accelerate price declines in leveraged markets.