Seilor declared Bitcoin's victory, but Strategy has taken a pause: what lies behind the five-week lull
Michael Saylor, Chairman of the Board of Strategy, stated that Bitcoin has achieved its greatest victory. However, according to him, the main risks for the first cryptocurrency now lie within the community itself. And these words come amid an unusual pause: his company has not purchased BTC for five weeks.
Analysts have examined the reasons for this lull. Instead of replenishing its cryptocurrency reserves, Strategy has built a substantial cash reserve of $3.75 billion. Thus, the organization is simultaneously implementing two opposing strategies: accumulating dollar liquidity and temporarily halting Bitcoin purchases.
Why is Saylor sounding the alarm right now?
The timing of Saylor's statements is directly linked to upcoming protocol changes. At the center of the discussions is proposal BIP-110, which is a soft fork. This update, developed by Dayton Ohm, limits the amount of arbitrary data within transactions. Miners began signaling support as early as December 1, 2025, although most ignored the initiative. However, this does not stop the process.
According to the implementation schedule, the mandatory lock-in phase will begin around August 2026. From that point, blocks without a support signal will be considered invalid. After this, the activation of BIP-110 becomes guaranteed. Two weeks later, the rules take effect, and after about a year, they automatically expire.
Saylor criticizes not the voting procedure itself, but the rigidly defined timeline scenario, which will be triggered shortly.
What is wrong with BIP-110?
The Chairman of the Board of Strategy compared Bitcoin's consensus rules to a constitution—they define concepts of ownership, scarcity, settlement, and authority. Any attempt to rewrite these rules to benefit specific groups, he says, harms all current and future network participants.
Saylor highlighted three key issues:
- BIP-110 introduces censorship for legitimate transactions with fees.
- Covenants open new attack vectors on the network.
- Increasing block size reduces blockspace scarcity and leads to higher costs for transaction verification.
Saylor's main technical complaint concerns miner revenue. Block subsidies are halved every 210,000 blocks, placing an increasing burden on transaction fees for Bitcoin's security budget. Weakening the block fee market, he believes, reduces the network's resilience.
Supporters of the initiative disagree with this position. They argue that haphazard data inputs burden nodes and crowd out legitimate payments.
Saylor is far from the only critic, and the positions of his opponents vary. Blockstream CEO Adam Back also opposes BIP-110, but his concern is less about censorship and more about the too-low activation threshold of 55%, which opens up risks of a hard fork.
Previously, Saylor called BIP-110 the biggest internal threat to Bitcoin.
Why did Strategy stop buying Bitcoin?
Raising capital through shares proved more advantageous than deviating from the chosen financial plan. A Form 8-K report dated July 27 confirms the dollar reserve was replenished by $525 million. The total amount reached $3.75 billion—according to the company's estimate, this is sufficient to pay dividends for 2.1 years, given annual obligations to preferred shareholders of approximately $1.76 billion.
Strategy raised this money through share placements, not by selling Bitcoin. Recently, the company sold MSTR shares worth $544.5 million. Of this, approximately $467 million and another $263.5 million came from issuances two weeks prior. Over three weeks, total share sales amounted to about $1.26 billion.
Shares had to be placed cheaply. MSTR is currently trading at $96.66—approximately 76% below its 52-week high of $414.36. Now, for every new dollar raised, the company must give up a much larger share than a year ago.
How far is Strategy from its 1 million BTC goal?
Strategy announced it aimed to accumulate 1 million BTC by the end of 2026. The company currently holds 843,775 BTC. It is short by 156,225 BTC.
There are about 22 weeks left until the end of the year. To close the gap, it would need to buy approximately 7,000 BTC per week—about $447 million at the current price. The company is currently not buying Bitcoin at all.
What should BTC and MSTR investors know?
The company's average cryptocurrency purchase price is $75,494 per coin. The Bitcoin price is around $63,817. From its peak value in October 2025 of $126,080, the price has deviated by nearly 49%. The current portfolio revaluation shows an unrealized loss of $9.9 billion.
Bitcoin needs to rise by about 18% for Strategy to at least break even. The current Bitcoin price does not facilitate this.
The situation with preferred shares explains the urgency. STRC shares are trading around $88.86—approximately 11% below their $100 par value, despite a dividend increase to 12% starting July 1 and the launch of a buyback program.
It was the pressure on STRC that influenced the decision to launch the Digital Credit Capital Framework on June 29, which authorized share buybacks and the sale of up to $1.25 billion worth of Bitcoin.
What to watch for in the next 30 days?
In the coming month, three events are worth monitoring:
- The opening of the mandatory signaling window for BIP-110 in August.
- The publication of Strategy's weekly reports and a potential record for the duration of the pause.
- The use of the $3.75 billion reserve to prevent selling Bitcoin from the $1.25 billion limit.
The accumulated reserve helps address current financial tasks while the community attempts to protect the protocol's long-term architecture.
Expert opinion: The pause in BTC purchases by Strategy is not a sign of disillusionment with Bitcoin, but a necessary measure to balance corporate finances in a declining market. However, if BIP-110 is adopted, it could become a serious test for community consensus—and then Saylor's statements about "internal risks" may prove prophetic.