Strategy (MSTR) Executive Chairman Michael Saylor has long maintained that he would never sell Bitcoin.
But on Monday, the largest company revealed that it had sold 32 Bitcoins in the last week, its first sale in four years. The announcement raised questions about whether one of Bitcoin’s most prominent corporate champions would change course.
Most analysts don’t think so. The deal sparked debate among investors, but most agreed that the sale amount was too small to change the strategy’s long-term Bitcoin accumulation strategy.
The company announced Monday that it sold 32 Bitcoins between May 26 and May 31 at an average price of $77,135, generating approximately $2.5 million to fund dividend payments on STRC, a high-yield perpetual preferred stock known as Stretch. Strategies still hold over 843,700 $BTC As of the end of May, the sale was equivalent to approximately 0.004% of the total number of shares held.
The announcement initially fueled concerns that Executive Chairman Michael Saylor would back away from his longstanding efforts to accumulate Bitcoin, but several analysts argued that the interpretation missed the big picture.
TD Cowen analyst Lance Vitanza said reports suggesting Strategy has become a meaningful seller of Bitcoin are exaggerated.
“The headline suggesting that Strategy has significantly reduced its Bitcoin position is misleading in our view,” Vitanza said in a research note. “This transaction is not economically significant and does not change the core theory of accumulation.”
Vitanza noted that management has discussed the possibility of restricting Bitcoin sales several times in recent days as part of a broader fundraising strategy. He added that TD Cowen’s model already predicts small tactical sales, so there is no change to the Bitcoin accumulation assumption or $400 price target.
The analyst also pointed to signs that Strategy is restructuring its cash position. The company also sold 801,944 shares of its common stock and repurchased $1.5 billion in convertible debt at a discount, then used a portion of the proceeds to replenish its cash reserves.
Benchmark analyst Mark Palmer came to a similar conclusion about the importance of the sale itself, saying he does not expect Bitcoin disposals to be the main source of funding for dividends.
“We do not expect Strategies to use Bitcoin sales as the primary means of funding STRC or other perpetual preferred stock issuance dividends,” Palmer said. “It is much more likely that the company will continue to replenish its cash reserves through equity issuance and then use its reserves to pay dividends.”
However, Palmer argued that the sale could change the way investors view Strategies’ Bitcoin holdings. “Investors should now view Strategy’s Bitcoin holdings as an effective backstop for financing preferred dividends,” he said.
Others saw the trade as a more meaningful signal.
Mark Connors, Risk Dimension’s chief information officer, said the move signals the strategy’s intention to prioritize the health of its capital structure over maintaining a strict no-sell stance on Bitcoin.
“By selling Bitcoin, Mr. Saylor expressed two things,” Connors said. “First, we will support our shareholders and creditors in every way possible, including by selling Bitcoin.”
“Second, Mr. Saylor and Strategy have prioritized the health and soundness of MSTR’s capital structure over being an OG with diamonds.”
The differing interpretations highlight important questions facing investors today. Analysts say 32-$BTC Sales weren’t important. What remains up for debate is whether this was simply a routine Treasury decision or an early sign that Strategy’s approach to managing its vast Bitcoin reserves is becoming more flexible.
Strategy fell 5% on Monday, sending Bitcoin to a nearly two-month low of $71,000.
