CryptoQuant has warned that Strategy should pause Bitcoin purchases and rebuild its cash reserves as pressure grows around its preferred stock structure.
Summary
- CryptoQuant says Strategy’s dividend coverage fell to 14 months as cash reserves kept shrinking fast.
- Ki Young Ju says Strategy’s Bitcoin buying may defend ranges, not drive fresh rallies now.
- MSTR closed at $103.84 while Bitcoin traded near $62,556 amid wider selling pressure this week.
The on-chain analytics firm said Strategy’s annualized dividend obligations have risen to about $1.2 billion.
The warning centers on STRC, Strategy’s perpetual preferred stock product. CryptoQuant said Strategy’s cash reserve has fallen 38% in 2026, while dividend coverage has dropped from more than seven years to about 14 months.
“Strategy’s annualized dividend obligations have nearly quadrupled to $1.2B, while its cash reserve has fallen 38% in 2026,” said CryptoQuant.
The firm said restoring 24 months of coverage would require about $2.8 billion in cash. That would be roughly twice the amount Strategy currently holds after its latest reserve increase.
Ki Young Ju questions buying pace
CryptoQuant CEO Ki Young Ju also argued that Strategy’s Bitcoin buying no longer works as a clear price driver in the current market. He said buying in a high-selling-pressure environment may only defend Bitcoin’s range rather than start a new rally.
“Strategy’s BTC buying here looks more like a liquidity sink than a price catalyst,” said Ki Young Ju.
He said the company should pause purchases, rebuild reserves and create a model-based purchase plan.
Ju said Bitcoin’s realized cap grew by $467 billion over the past two years, while price was down 1%. In his view, that shows capital is moving through the market without creating a strong upward trend.
He also said continuous buying may delay a deeper market reset. Bitcoin cycles often involve crashes, capitulation, weak-holder exits and whale accumulation. Ju said this cycle has stayed in a wide sideways range instead.
Strategy keeps buying, but raises reserves
Strategy has not fully stepped away from Bitcoin accumulation. The company bought 520 BTC for about $35 million at an average price of $67,068, bringing its total holdings to 847,363 BTC.
Strategy also increased its U.S. dollar reserve by $300 million to $1.4 billion. That move showed a stronger focus on liquidity while the company continued to add Bitcoin.
The company raised about $335.5 million through MSTR share sales during the same period. Only part of that money went into the latest Bitcoin purchase, while the rest supported the cash reserve.
In a recent update, crypto.news covered Strategy CEO Phong Le’s $1 million STRC purchase. Le said he would hold the position until it returned to par value, likely longer. STRC had traded below its $100 par value after falling near record lows.
STRC and MSTR remain under pressure
STRC has become a key part of the debate around Strategy’s Bitcoin funding model. The preferred stock offers an 11.5% yield and was designed to trade near $100, but it recently fell as low as $82.50.
At around $87.40, STRC’s effective yield stood near 13.2%, according to STRC tracker data. A higher yield can show that investors are asking for more compensation to hold the product.
Previously, crypto.news explored how STRC’s drop tested Strategy’s Bitcoin-backed credit model. That report said the selloff may have reflected a leverage flush, but it also showed how thin liquidity and Bitcoin volatility can pressure preferred stock products.
MSTR also weakened with the broader market. Strategy shares closed at $103.84 on Tuesday, down 5.13%, according to Google Finance. The stock hit a 52-week low of $103.52 during the session.
Bitcoin traded near $62,556, according to crypto.news market data, after failing to hold the $64,000 area. The price move kept attention on Strategy because the company remains the largest public corporate holder of Bitcoin.
Strategy co-founder Michael Saylor has defended the company’s structure. As crypto.news reported, Saylor said Strategy’s Bitcoin and cash reserves exceed outstanding debt by about $48 billion. He also said the company had raised more than $60 billion in capital since 2022 and used it to acquire Bitcoin.
CryptoQuant’s warning does not say Strategy faces an immediate cash crisis. It says the company’s balance between Bitcoin buying, dividend obligations and cash reserves has become harder to manage while Bitcoin trades weakly and STRC remains below par.
