Strategy, First Sale of 32 BTC...Ending Bitcoin Holding Strategy?

▲ Strategy (MSTR), Bitcoin (BTC)/AI generated image

Strategy, the world's largest publicly traded company holding Bitcoin (BTC), sold a portion of its holdings for the first time since 2022. With Michael Saylor's silence, market attention is turning to the issue of funding preferred stock dividends.

According to cryptocurrency media outlet Cointelegraph on June 1 (local time), Strategy sold 32 BTC for $2.5 million last week. The average selling price was recorded at $77,135 per BTC. Its holdings decreased from 843,738 BTC to 843,706 BTC. In an 8-K filing submitted to the U.S. Securities and Exchange Commission (SEC), Strategy stated that it plans to use the proceeds from the sale to fund preferred stock dividends.

This sale marks Strategy's first disclosed disposal of Bitcoin since a transaction in 2022 where it sold 704 BTC for tax loss purposes and then bought back 810 BTC two days later. Until now, Strategy has been considered a symbolic company for its Bitcoin acquisition strategy. However, as market scrutiny intensified over the preferred stock financing model, concerns have been raised that dividend burdens could lead to pressure to sell its Bitcoin holdings.

During the same period, in addition to selling Bitcoin, Strategy also divested 801,994 shares of Class A stock (MSTR), raising $128.3 million. However, no new capital was raised through preferred stock during that week. Michael Saylor, co-founder of Strategy, posted a bubble chart showing the company's past Bitcoin acquisition trends on X (formerly Twitter) over the weekend, along with the phrase “working better.” However, he made no separate mention of the $2.5 million Bitcoin sale.

The market also noted Saylor's silence on this sale, unlike his usual quick disclosure of new purchases. Earlier, cryptocurrency information platform Arkham reported that Strategy had transferred Bitcoin to Coinbase Prime last Friday. Strategy CEO Phong Le said last week, “We are highly likely to sell Bitcoin at some point, but we will increase our net Bitcoin holdings and, more importantly, increase Bitcoin per share.”

The buying spree by companies adopting Bitcoin as a treasury strategy also showed signs of slowing down. Nasdaq-listed ProCap Financial announced on Monday that it sold approximately 52 BTC to buy back 2 million common shares at a discount of about 50% to net asset value. According to corporate disclosures, companies' total Bitcoin purchases last week amounted to only 144 BTC, a significant decrease compared to 603 BTC in the previous week.

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