Strategy Holds $2.21B Cash for 10-Month Dividend, Shares Plunge
MSTR•Strategy holds $2.21 billion in cash reserves, enough to fund its preferred-stock dividends for the next 10 months after raising $2 million by selling 32 BTC. The company’s common and preferred shares have plunged, with common stock down 45% year-to-date and preferred below par.
1. Cash Runway and Dividend Funding
Strategy holds $2.21 billion in U.S. dollar reserves, enough to cover the dividend on its perpetual preferred stock for 10 months. The company sold 32 BTC at the end of May, raising $2 million to support dividend payments, as its preferred shares yield over 12% and trade 23% below par value.
2. Class Action Investigation
A prominent law firm has initiated a class action investigation into Strategy and certain executives over potential misleading statements about its Bitcoin treasury strategy, profitability and risk management. The probe covers multiple securities, including common and preferred shares, but does not yet allege misconduct; heightened volatility in the capital structure triggered the inquiry.
3. Analyst Warning to Pause Bitcoin Buys
One analytics firm recommends that Strategy pause new Bitcoin acquisitions and rebuild its U.S. dollar cash buffer before resuming systematic purchases. It warns that dividend obligations on preferred shares could require roughly $1.2 billion annually, and weakening coverage poses a risk to the funding model underpinning continued Bitcoin accumulation.
