Strategy builds huge cash reserve to protect dividends
Strategy is one of the biggest corporate holders of Bitcoin in the world and holds around 650,000 Bitcoin, or roughly 3.1% of the maximum 21 million coins. It has now created a 1.44 billion US dollar reserve, described as a dedicated “USD Reserve”. This money will support dividend payments on preferred shares and interest on company debt. The cash came from recent sales of common stock through an at‑the‑market share offering programme. Strategy raised the full amount in fewer than ten trading days, according to company disclosures. Management says the reserve already covers about 21 months of planned dividend payments.
Their stated goal is to grow it until it covers at least two full years of distributions. For beginners, a dividend is a regular cash payment that some companies send to shareholders. These payments continue even when markets are volatile. Bitcoin’s price has recently fallen sharply from its October highs, putting pressure on Strategy’s earnings forecasts. In response, the firm cut its 2025 profit and Bitcoin yield targets to reflect the weaker market. Executives say the new reserve should reassure investors that dividends can still be paid during downturns.
Strategy keeps door open to future Bitcoin sales
Despite the large dollar reserve, Strategy has not ruled out selling some Bitcoin in future. Chief executive Phong Le explained that the reserve complements, rather than replaces, the company’s Bitcoin holdings. Executive chairman Michael Saylor previously promoted a “never sell Bitcoin” philosophy in public interviews. His stance has now softened in light of dividend obligations and changing market conditions. Management introduced a metric called market‑adjusted net asset value, shortened to mNAV. This compares the company’s total market value with the value of its underlying assets, mainly Bitcoin. Le has said the firm might consider selling Bitcoin if mNAV drops below one. That level would mean the market values the company at less than its asset holdings.
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For now, Strategy’s own figures place mNAV at around 1.13, giving a modest cushion. Some investors worry that any move to sell coins could hurt market sentiment and Bitcoin’s price. However, company leaders argue that having both a Bitcoin reserve and a dollar reserve actually strengthens their long‑term strategy. They claim this structure lets them keep paying dividends, ride out volatility, and still aim to accumulate more Bitcoin over time. Prediction markets operated by Decrypt’s parent company currently see only a small chance of a sale this year.
