Strategy sells $395M of Bitcoin, shifts cash to STRC buybacks and builds a $4B reserve

Strategy’s latest Bitcoin sale brings its 2026 disposals to 5,258 BTC, the company’s largest annual selling volume since it launched its Bitcoin-focused treasury strategy in 2020. In an Aug. 3 filing with the U.S. Securities and Exchange Commission, the company said it sold 1,638 BTC between July 27 and Aug. 2 for $104.7 million. Over the same period, it issued about 3.01 million shares of MSTR common stock, raising $290.6 million. The combined roughly $395 million was not deployed to buy more Bitcoin. Instead, Strategy directed the proceeds toward preferred stock dividends, repurchases of its STRC preferred shares, and a push to expand U.S. dollar cash reserves to $4 billion. The reallocation has also extended its pause in Bitcoin purchases to six weeks, the longest buying hiatus since 2024. STRC discount drives capital shift The immediate pressure point is STRC, a floating-rate preferred stock that Strategy has positioned as a long-term funding channel for its Bitcoin treasury. When STRC trades near its $100 par value, Strategy can issue new shares close to par and use proceeds flexibly, including for Bitcoin purchases. When STRC trades at a sustained discount, that financing channel loses effectiveness because new issuance would likely require a lower price or a higher dividend yield to attract buyers. STRC has remained below par since May, even after Strategy raised its annualized dividend to 12% and launched open-market repurchases. Last week, the company used $52.3 million from Bitcoin sales plus $28.9 million from MSTR issuance—$81.2 million total—to repurchase 912,143 STRC shares. The week before, it completed a $25 million buyback, purchasing 288,930 shares at an average $86.53. On the Q2 earnings call, President and CEO Phong Le said buying back STRC below par lets Strategy reduce future dividend obligations at a discount while boosting demand and helping move the price back toward $100. Since the program began in July, Strategy has spent about $106.2 million on STRC repurchases. The company said it still has $893.8 million remaining under its preferred buyback authorization. Its $1 billion authorization for MSTR common-stock repurchases remains unused. Strategy aims to bring STRC back to par by September, with the pace of buybacks tied to price action and market liquidity. As of July 26, 2026, Strategy has raised $7.53 billion through various capital instruments, with preferred stock taking on a larger role in its financing mix. A $4B reserve to support preferred payouts Strategy is also building a dedicated cash buffer to fund preferred dividends and debt interest. Of the $290.6 million raised via the recent MSTR secondary offering, $250 million was allocated to the U.S. dollar reserve, with $11.7 million retained as working capital. The reserve stood at $2.55 billion at the end of June and rose to $3.75 billion on July 26 after a common-stock offering. With this latest funding, the company said it has now reached its $4 billion target. When it updated its capital framework in June, Strategy estimated annual preferred dividends plus debt interest at about $1.76 billion. At that run rate, a $4 billion reserve would cover roughly 27 months of payouts. Absent additional board approval, Strategy said the reserve can be used only to pay preferred dividends and interest on existing debt. The buffer reduces a key risk: the company may avoid selling assets or issuing additional securities to meet near-term obligations during adverse markets. It also gives preferred shareholders added protection if Bitcoin prices fall or capital markets tighten. The tradeoff is greater dilution for common shareholders. Last week, Strategy issued 3.01 million MSTR shares while selling 1,638 BTC and buying no Bitcoin, reducing Bitcoin held per diluted share. Longtime Bitcoin bear Peter Schiff argued the sequence suggests Strategy is leaning more on Bitcoin sales and MSTR issuance to prioritize preferred holders. That shift is visible in the firm’s “bitcoins per share” metric. Since the start of the year, the increase has slowed to 3.5%, down from 13.3% at the end of May. So far this quarter, the metric is down 4.6%. Strategy defines “BTC yield” as the percentage change in Bitcoin holdings per diluted share and converts the change in holdings into an estimated number of bitcoins. The company cautioned these measures are not shareholder returns, revenue, or cash flow, and do not indicate its ability to meet debt obligations. Bitcoin becomes a recurring liquidity tool Strategy’s steady Bitcoin sales this year indicate Bitcoin has effectively become a routine liquidity source for its broader securities-and-capital-structure strategy. The company sold 32 BTC in late May, 1,363 BTC on June 29 and 30, 2,225 BTC in the first five days of July, and 1,638 BTC last week. Bitcoin analyst Will Clemente said the transactions show how Strategy is balancing the interests of three groups: Bitcoin holders, MSTR common shareholders, and preferred investors. He described the sales as evidence management is willing to shift capital within the balance sheet to keep any single security from becoming a strain on the overall structure. The company formalized that flexibility through its “BTC Liquidity Plan,” which authorizes Bitcoin sales to lift reserves by up to $1.25 billion. Proceeds can be used to pay preferred dividends, service interest, or repurchase preferred or common shares. Any sales beyond those purposes or the stated cap require additional board approval. Executive Chairman Michael Saylor rejected claims that the plan contradicts a commitment to hold Bitcoin indefinitely. He said Strategy disclosed the monetization plan 31 days before the Q2 earnings release, on June 29, and emphasized the company never had a strict “never sell” policy. Saylor added the plan does not require any Bitcoin sales and said the firm still expects to be a net buyer over the long term. Strategy remains the largest public company holder of Bitcoin, with 842,138 BTC—about 4% of Bitcoin’s 21 million supply cap. The company’s total cost basis is $63.51 billion, implying an average purchase price of $75,419 per bitcoin. With Bitcoin around $62,633 at the time of writing, the stash is valued at roughly $52.7 billion, an unrealized loss of about $10.8 billion versus purchase cost. If the company continues selling below its average cost, unrealized losses could turn realized and the Bitcoin reserve supporting its common and preferred structures—and ongoing dividend obligations—would shrink further. As a result, Saylor’s expectation of returning to net Bitcoin accumulation increasingly hinges on restoring STRC to par, enabling smoother financing without persistent dilution of MSTR holders or ongoing depletion of Bitcoin reserves.