Author: Xiaobing
Strategy sold 18.26 million shares of common stock last week, raising $2 billion. Not a single Bitcoin was purchased.
The allocation of this money is as follows: $136 million used to repurchase its STRK preferred shares, $300 million injected into the existing USD Reserve pool, and the remaining $1.59 billion placed into a newly established "USD Cash" pool. As of August 23, Strategy had $6.69 billion in cash on its books, with its Bitcoin holdings of 840,447 coins remaining completely unchanged.
This is a company that used to file an 8-K every week announcing Bitcoin purchases, with its founder posting pictures on X every Sunday to flaunt the holdings. Michael Saylor's iconic "green square chart" hasn't been updated for several weeks.
The essence of the question of why Strategy paused its purchases is, what kind of company is it becoming?
From 'Never Selling' to a Digital Credit Capital Framework
On May 26, 2026, Strategy sold its first batch of Bitcoin in history: 32 coins, worth approximately $2.5 million. The quantity was insignificant, but the signal was deafening.
Subsequent five sales escalated step by step.
32 coins at the end of May, 1,363 coins at the end of June, 2,225 coins at the beginning of July, 1,638 coins at the end of July, and 1,690 coins at the beginning of August. Strategy sold a total of approximately 6,916 BTC in 2026, cashing out approximately $432 million.
Except for the first sale, which executed slightly above cost at $77,135, all others were executed in the $60,000-$64,000 range, far below the average holding cost of $75,385. The realized loss on paper exceeds $102 million.
Selling at a loss? It's because the bills are due.
On June 29, Strategy officially released its "Digital Credit Capital Framework." The core content of this document includes three authorizations: a "BTC Liquidation Plan" allowing the sale of up to $1.25 billion worth of Bitcoin; a $1 billion preferred stock repurchase authorization and a $1 billion common stock repurchase authorization; and a mandatory USD reserve policy requiring reserves to cover at least 12 months of preferred stock dividends and interest payments.
By August 1, the BTC liquidation authorization had been expanded to $5 billion.
Understanding the meaning of these numbers: Strategy has issued five series of preferred stock (STRK, STRF, STRD, STRE, STRC), with annual dividend yields ranging from 8% to 12%; combined with over $6.7 billion in convertible bond interest, the company needs to pay approximately $1.76 billion in hard dollar obligations annually. At the beginning of 2026, the dividend coverage ratio could still last over 7 years; by June, CryptoQuant's calculations showed this number had shrunk to about 14 months.
The crux is that in May, Strategy spent $1.38 billion in cash to prepay $1.5 billion face value of its 2029 convertible bonds (an 8% discount). This operation, while eliminating debt and boosting the "Bitcoin per share" metric, directly drained the cash pool. It's like a family paying off their mortgage early, only to find they have no income next month.
Therefore, since the end of June, Strategy's operational logic has undergone a fundamental shift: it's no longer the flywheel of "raise capital → buy Bitcoin → announce increased holdings → stock price rises → raise more capital → buy more Bitcoin," but rather the balance sheet management of "raise capital → build reserves → stabilize preferred stock → repurchase STRC → wait for opportunities."
Transformation
On the surface, stopping Bitcoin purchases is admitting defeat. MSTR is down over 60% year-to-date and nearly 80% from its 2024 all-time high. The market is pricing it like a failed leveraged BTC ETF.
But if you shift the perspective from "Bitcoin proxy stock" to "capital structure engineering," the logic is completely different.
Saylor's rhetoric in the Q2 earnings report has quietly changed. He no longer repeats the old narrative of "Bitcoin rises, MSTR must follow." He has started frequently using the terms "Bitcoin Per Share" and "BTC Yield."
So far in 2026, although Strategy has sold nearly 7,000 BTC, the BTC Yield has remained at 13.3% through concurrent repurchases of STRC and share management. In plain language: the total number of BTC the company holds has decreased, but because it is simultaneously repurchasing its own stock and preferred shares, the amount of BTC corresponding to each share of MSTR is actually increasing.
The logical model of this operation is closer to a bank than a fund.
A bank's core competency lies in managing the interest rate spread, duration, and liquidity between assets and liabilities; the holding amount itself is never the focus.
What Strategy is doing is treating Bitcoin as "reserve assets," MSTR common stock as "equity capital," and STRC and other preferred stock as "deposit-like liabilities," then performing dynamic balancing among the three.
The $6.69 billion in cash is Strategy's version of a "capital adequacy ratio buffer."
In a research report on August 22, Bernstein gave the trigger condition for resuming purchases: STRC returning to near its $100 par value. This preferred stock fell to as low as $70 in June, reflecting market panic over Strategy's solvency. Now STRC has recovered to about $96.5, and the dividend coverage ratio has improved from 14 months to about 2.8 years, meaning the balance sheet pressure has significantly eased.
Look at it from another perspective: Strategy was forced to sell small amounts (about 0.8% of holdings) at BTC prices of $60,000-$64,000 to stabilize its capital structure. Now, with BTC at $80,000, it holds $6.7 billion in cash, 840,000 BTC, and close to zero net leverage. If selling at low prices is "cutting losses," then holding massive firepower without buying at high prices is an exercise in extreme restraint and timing judgment.
Why the Market Doesn't Care
A noteworthy phenomenon is: the world's largest corporate Bitcoin holder has been reducing its holdings by nearly 7,000 BTC over two consecutive months, yet the BTC price not only didn't face downward pressure but soared from $60,000 to $81,000 during the same period.
This indicates at least two things. The pricing power of the BTC market has shifted from a single institution to a broader capital structure. The spot ETF's weekly net inflow of $1.92 billion is enough to completely absorb Strategy's selling pressure.
Simultaneously, the market is "pricing in" Strategy's transformation itself: MSTR rose about 1.2% on the trading day after BTC broke through $80,000, not following BTC with 2-3x leveraged volatility as it did in the past. The compression of the premium (mNAV dropping from over 3x at its historical peak to roughly flat) means the market has already reclassified MSTR from "leveraged BTC" to a company that needs to be valued using a DCF model.
If Strategy can successfully complete its transformation from "Bitcoin maximalist" to "digital credit issuer," it might become an unprecedented species in the crypto industry: a "Bitcoin bank."
Different from exchanges, custodians, and ETF issuers, it uses Bitcoin as reserve assets, multi-layered capital instruments as its liability side, and "Bitcoin per share appreciation" as its operational goal, resembling a new type of capital management company.
The risks on this path are equally enormous: $1.76 billion in annual hard obligations means that for every day the BTC price falls below the cost basis of $75,385, the safety margin of the balance sheet thins. The $5 billion BTC liquidation authorization means the board has prepared for the worst-case scenario.
Saylor no longer posts his chart every Sunday, but his silence might be more worthy of serious attention than his past proclamations.
