Bitcoin purchase plan under threat: Strategy needs urgent reassessment
Strategy, a company that once set the pace for institutional bitcoin accumulation, now faces a critical situation requiring an immediate course correction. My analysis shows that aggressive buying of the first cryptocurrency has led to a dangerous imbalance in capital, and the current strategy is no longer sustainable.
Since the beginning of 2026, Strategy's dollar cash reserve has declined by 38%. Over the same period, annual dividend payment obligations on STRC preferred shares have nearly quadrupled — from $300 million to $1.2 billion. With an STRC yield of 11.5%, the dividend coverage ratio, meaning the period for which the current reserve will last, has collapsed from seven years to approximately 14 months. This is an alarming signal that cannot be ignored.
Reserve Under Pressure: Bond Buyback and STRC Decline
A particularly severe blow came in May 2026, when the company spent $1.5 billion on buying back its own convertible bonds. In my assessment, this step only worsened the liquidity deficit that could have been used to service STRC. Last week, the STRC price fell to $82.50, which is 17.5% below the par value of $100. The decline is linked not only to market speculation but also to the deterioration of Strategy's own fundamental indicators.
Selling Bitcoin — A Dead End
Rapidly restoring the reserve by selling a portion of bitcoins is a scenario that, in my view, would destroy shareholder value. The company holds 847,363 BTC on its balance sheet, and all coins purchased since 2024 are in the red. The unrealized loss stands at $10.6 billion. A forced sale is unlikely, but even the thought of it undermines market confidence.
Necessary Measures: Pause and Reset
My analysis confirms: to bring STRC back to a comfortable level, the cash reserve must grow to $2.8 billion, providing 24 months of dividend coverage. As of mid-June, the company had only $1.1 billion. The priority is an immediate pause in bitcoin purchases and the restoration of the dollar buffer. Only after that should the company transition to a more systematic approach to new acquisitions, rather than increasing positions with each capital raise.
Expert Commentary: Strategy's situation is a classic example of overestimating one's own sustainability in pursuit of growth. STRC dividends are cumulative, so missed payments do not disappear but accumulate. This means the company has backed itself into a corner where a pause in purchases is not just a recommendation but the only reasonable way out to preserve the long-term viability of the model.