Strategy, the company with the largest Bitcoin holdings, has sold 3,588 bitcoins, according to a filing disclosed on the 6th (local time). It is the company’s largest sale ever.
The average selling price was about 20% lower than the purchase price. The proceeds will be used to pay preferred stock dividends and strengthen dollar reserves.
The move has put the entire digital asset treasury (DAT) model, which had been built on Michael Saylor’s pledge that “we will never sell Bitcoin,” to the test.
The company has also approved a sale program worth up to $1.25 billion, meaning room for additional sales has now been institutionalized.
Bitcoin, the asset hoarded most by the company that owns the most of it, had apparently broken a promise it seemed least likely to abandon. Strategy, the emblematic digital asset treasury (DAT) company, has disposed of Bitcoin at a record scale. What the market is focusing on is not the sale itself, but the structure that made the sale unavoidable.
A DAT is a company that buys crypto assets with corporate funds to boost enterprise value. Strategy is the original model. While its core business is software, the company’s valuation is effectively determined by the Bitcoin stored in its treasury. When Bitcoin rises, the stock climbs even more sharply; when it falls, the opposite happens. It is a leveraged structure.
Michael Saylor, chairman of Strategy’s board, said on X on the 6th (local time) that the company “sold 3,588 bitcoins and used $216 million to pay dividends on digital credit securities.” According to a U.S. Securities and Exchange Commission (SEC) filing, the company sold 1,363 bitcoins on June 29-30 at an average price of $59,256 and another 2,225 bitcoins on July 1-5 at an average price of $60,773.
◆ A 20% loss: the story told by two rounds of sales
The most painful part of this sale is the price. As of July 5, Strategy’s average purchase price for Bitcoin was $75,476 per coin. The average selling price this time was about 20% lower. In other words, it bought high and sold low. Peter Schiff, a financial commentator and Bitcoin skeptic, mocked the move, saying, “They buy at the top and sell at the bottom.”
The scale is also on another level. Strategy’s first sale was just 32 bitcoins in May. In less than two months, it has sold more than 100 times that amount. With this sale, holdings fell from 847,363 bitcoins to 843,775. Cumulative purchase costs have reached $63.69 billion. The mark-to-market damage is also severe. The company recorded a $8.32 billion loss in its digital asset segment in the second quarter, most of it ($8.31 billion) unrealized losses on coins it still holds.
◆ Bills paid in dollars… the structure behind the broken “we will never sell” promise
Saylor had repeatedly proclaimed on X that “Bitcoin will never be sold.” The reason that promise was broken appears to lie within the company’s business model.
Strategy is a company that buys Bitcoin using money raised through preferred stock and bonds. The problem is that preferred stock is not free money. The company’s five classes of preferred shares require monthly or quarterly dividend payments in dollars. The top-tier security carries a fixed annual dividend of 10%. In the days when Bitcoin was rising and the stock traded at a premium, the company could issue new shares to fund dividends. Now that Bitcoin has fallen by half from its peak, that route has narrowed. The remaining option was the coins in the vault.
The filing also contained clues. In the week when the sales took place, the company did not sell any shares through its at-the-market stock issuance program, nor did it buy back any stock. That suggests the channel for raising cash by issuing shares had effectively stalled just as dividend deadlines approached.
Saylor sees it differently. He describes the sale not as a retreat, but as fulfilling a promise to preferred shareholders. When the first sale occurred earlier, he said the goal was to “make our credit securities the best products in the world.” His logic is that a company that never misses dividends will lower its borrowing costs over the long term. As of July 5, the company had accumulated $2.55 billion in dollar reserves specifically for dividends and interest.
◆ A $1.25 billion sales cap… why the market is on edge
The focus now is on the possibility of further sales. Strategy’s board approved a “Bitcoin monetization program” on June 29. Under this framework, the company can sell up to $1.25 billion worth of Bitcoin as needed to bolster dollar reserves, pay dividends, and repurchase stock. Separate from this sale, the full limit remains unused. The decision has been formally documented: if necessary, it can sell again.
The reason this company’s moves matter beyond a single firm is its scale. Strategy’s holdings of more than 840,000 bitcoins amount to 4% of total Bitcoin supply. The fact that the biggest holder has shifted from being a buyer to someone who could also sell is enough to weigh on market sentiment.
Other treasury companies that followed Strategy’s lead and accumulated coins are also facing the same dividend and interest obligations. The debate is now between warnings that the first domino may have fallen and counterarguments that the model has, in fact, been validated through dividend payments.
Bitcoin is trading around $60,000 in the morning of the 8th. Compared with last year’s October peak of $126,000, it has nearly halved. What Saylor has kept is the dividend promise, and what he has broken is the no-sale promise. Which of those two commitments will sustain the company will likely be determined by whether the remaining $1.25 billion limit is actually used.