Market maker QCP has raised concerns that Strategy may need to sell additional Bitcoin to meet dividend payments, estimating the company’s current liquidity runway at roughly seven and a half months. The warning comes after Strategy recently repurchased nearly $1.5 billion in convertible notes and raised about $200 million through MSTR stock sales, with part of the proceeds funding a $100 million Bitcoin purchase.
Dividend obligations have become a focal point, as QCP suggests Bitcoin sales could be an option if alternative funding sources become less attractive. This follows Strategy’s disclosure of a 32 BTC sale earlier this month, the first reduction in its holdings, which drew criticism given Chairman Michael Saylor’s long-standing buy-and-hold philosophy.
CEO Phong Le clarified that the 32 BTC sale was not dividend-driven but a procedural test to generate tax losses and reduce future market shock. He emphasized that Strategy still has access to equity issuance and preferred-stock financing, and would evaluate both Bitcoin sales and share issuance based on financial outcomes.
Critics like Peter Schiff argue that Strategy’s model is less effective now that MSTR trades at a lower premium to Bitcoin holdings. Schiff contends that recent share issuances to buy Bitcoin dilute shareholders, citing a purchase of 1,550 BTC in early June as reducing per-share Bitcoin exposure. Despite this, Strategy continues accumulating, buying another 1,587 BTC on June 15 and boosting cash reserves to $1.1 billion. Concerns also surround STRC preferred shares, which could pressure the company if they trade below intended levels.