MSTR discloses selling 3,588 bitcoins, stock price once fell 5% during trading.

Strategy is rewriting its own business model. The world's largest corporate Bitcoin holder disclosed on July 6 that it sold 3,588 Bitcoin between June 29 and July 5, cashing out approximately $216 million to pay dividends on its preferred stock. This is not only the largest Bitcoin sale in the company's history, but also the third sale since it launched its Bitcoin strategy in 2020.

This sale sends an important signal: Bitcoin is gradually shifting from Strategy's "only buy, never sell" strategic reserve to an asset that can be used for liquidity management.

According to Bloomberg, the company just expanded its authorization last week, allowing it to sell Bitcoin to supplement liquidity when new equity financing becomes less attractive. This adjustment comes amid pressure on both Bitcoin and Strategy's stock price. Over the past year, MSTR has fallen approximately 75%, while Bitcoin has retreated more than 45% from its all-time high.

After the announcement, Strategy's stock price fell over 5% intraday, and Bitcoin dropped to around $61.8k, below the company's average holding cost of approximately $75.7k.

The "Never Sell Bitcoin" stance begins to waver

Strategy has long regarded "never selling Bitcoin" as the cornerstone of its business model, but this commitment has shown clear signs of loosening.

At the end of May this year, the company broke its convention for the first time, selling 32 Bitcoin for approximately $2.5 million to pay preferred stock dividends. At the time, the company emphasized that this was only to fulfill commitments to preferred stock investors and did not represent a strategic shift.

However, the latest round of sales has expanded significantly to 3,588 Bitcoin, roughly 100 times the amount sold in May. According to the company's disclosure, 1,363 of these were sold at an average price of approximately $59.3k, while the remaining 2,225 were sold at approximately $60.8k. This indicates that selling Bitcoin is no longer a one-time symbolic operation but is gradually being integrated into the company's regular financing system.

$1.5 billion annual dividend pressure, hundredfold sale exposes tight cash flow

The proceeds from this sale will be used specifically to pay second-quarter dividends for four preferred securities—STRF, STRE, STRK, STRD—and the June monthly dividend for STRC. Analyst Zach Pandl pointed out that Strategy's annual preferred stock dividend payments alone amount to approximately $1.5 billion, far exceeding the cash flow from its software business. When cash reserves are insufficient, the company has to either continue financing or sell Bitcoin.

As of July 5, Strategy held 843,775 Bitcoin, with cash reserves of $2.55 billion and an average holding cost of approximately $75,700. Although the company quickly bought another 1,550 Bitcoin after its first sale at the end of May, and completed large-scale purchases of $2.54 billion and $2 billion in April and May respectively, this sale does not mean a halt to accumulation but rather a flexible adjustment within the system.

Strategy's operating logic is becoming increasingly clear: continue buying Bitcoin when financing is smooth, and sell a small amount of Bitcoin to pay dividends when financing tightens, thus maintaining the closed loop of its capital operation system. According to Bloomberg, the company confirmed a digital asset impairment loss of $8.32 billion in the second quarter, while Bitcoin's price fell 14% during the same period, further exacerbating its cash flow management pressure.

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