Strategy Cash Reserves Cover 10-Month Dividend as STRC Falls 23%
MSTR•Strategy holds $2.21 billion cash reserves sufficient to cover its preferred stock dividend for 10 months after selling 32 BTC to fund payouts. Preferred shares have plunged 23% to $77 while common stock is down 8% intraday and 45% year-to-date, as a legal probe and funding warnings escalate.
1. Cash Reserves and Dividend Funding
Strategy Inc. reports $2.21 billion in U.S. dollar cash reserves, enough to fund its preferred stock dividend for the next 10 months. The company sold 32 BTC at the end of May specifically to bolster this cash buffer and support payouts.
2. Preferred Stock Discount and Investor Concerns
STRC, the perpetual preferred shares yielding over 12%, has collapsed 23% below its $100 par value to trade at $77, highlighting investor doubts. Meanwhile, the common shares fell 8% on June 25 and are down 45% year-to-date at $86.34.
3. Legal Probe by Rosen Law Firm
Rosen Law Firm opened an investigation into Strategy and its executives for potentially misleading statements about its Bitcoin treasury strategy, profitability, and risk disclosures. The probe targets multiple securities, including common and preferred classes, but does not yet allege wrongdoing.
4. Analyst Warnings and Funding Model Risks
CryptoQuant advises pausing new Bitcoin purchases and rebuilding cash reserves as dividend liabilities grow, warning that the funding structure faces mounting pressure. Sector analysts warn that the company’s aggressive accumulation model resembles a bubble and may require a strategic pause.
