Strategy May Sell Up to $1.25B Bitcoin Under Digital Credit Capital Framework

Strategy disclosed its "Digital Credit Capital Framework" on June 29, filing an 8-K with the SEC that officially authorizes the company to sell Bitcoin to cover dividends, debt, and liquidity gaps. Shares of MSTR rose more than 5.5% ahead of the Nasdaq open, though they remain down roughly 50% year-to-date.

New BTC Monetization Scheme: How It Works

The framework has three parts. First, Strategy has grown its cash reserve to $2.55 billion. By the company's calculations, that covers about 17 months of preferred stock dividend payments and debt service. The board is now required to maintain a minimum of 12 months of coverage unless it votes to lower that threshold.

Second, the company may sell Bitcoin, up to $1.25 billion worth, to meet obligations to preferred stockholders or lenders. Third, the annual dividend rate on STRC preferred stock has been raised from 11.5% to 12%, and separate buyback programs have been authorized for both STRC and common MSTR shares.

Combined, the cash reserve and potential BTC sale give Strategy $3.8 billion in dividend coverage, roughly 26 months. "Strategy expects to remain disciplined in its use of MSTR issuance, particularly when the stock trades at or near 1x mNAV," executive chairman Michael Saylor wrote in the filing.

Why This Framework Emerged Now

Strategy holds 847,363 BTC purchased at an average of $75,651 per coin. With Bitcoin trading near $59,200, the portfolio is worth roughly $50.2 billion against a book value of $64.1 billion. MSTR shares have dropped nearly 50% since January 2026. STRC preferred stock traded as low as $71.25 on Friday, a 28.75% discount to par value of $100.

Last week, Grayscale research head Zach Pandl publicly recommended Strategy sell $3 billion in Bitcoin to restore confidence among lenders and preferred shareholders. The framework is partly a response to that pressure: it creates a legal mechanism for Bitcoin sales without committing to use it.

Strategy also raised approximately $1.15 billion in the same week by selling 12.67 million MSTR shares. The company made no new Bitcoin purchases in the week ended Sunday, leaving holdings unchanged at 847,363 BTC.

Risks for MSTR and STRC Holders

The new framework does not remove risk. It organizes it. If Bitcoin stays below $59,000, a $1.25 billion sale covers only part of the gap. Grayscale believes at least $3 billion is needed to fully restore the liquidity buffer. The framework addresses roughly one-third of that.

For MSTR shareholders, the risk is dilution of the core asset. The entire investment case for MSTR rests on concentrated Bitcoin exposure through "Bitcoin per share." Partial monetization reduces that metric. STRC holders get a higher dividend but still trade their shares at a significant discount to par. Their key risks include:

• BTC could fall to levels where $1.25 billion in sales no longer covers dividend obligations
• The market may not respond to the higher dividend by restoring STRC to par value
• A further MSTR decline limits the company's ability to raise capital through new share issuance

MSTR Rises, Analysts Ask Questions

MSTR shares rose more than 5.5% before the Nasdaq open. Markets read the framework as a sign that Strategy is managing the situation proactively rather than scrambling to respond. The 26-month buffer confirmation and the STRC dividend increase read as deliberate steps, not emergency measures.

Some analysts see a deeper contradiction. Strategy built its identity on the idea of never selling Bitcoin, a position Saylor promoted for years. The framework does not technically break that position, but it creates an official exit channel. For institutional buyers who owned MSTR specifically because of that commitment, the shift matters.

Grayscale recommended selling $3 billion. Strategy capped its stated capacity at $1.25 billion. The gap between the two figures is still an open question for the market.

Bitcoin Below Cost Basis: Impact on Markets and Traders

Strategy's 847,363 BTC equals roughly 4% of total Bitcoin supply. Selling $1.25 billion at current prices means unloading approximately 21,000 coins. Even spread over time, sustained selling at that scale would add downward pressure to a market that has already seen weakening demand across several quarters.

If Bitcoin recovers above $75,000, the monetization need disappears. As long as prices stay below Strategy's average cost basis, the company faces ongoing liquidity pressure. Those looking to exchange Bitcoin for hryvnia should factor this institutional overhang into their market outlook for the second half of 2026.

This framework is not a capitulation. It is the first official step from unconditional buy-and-hold toward active position management. Whether that turns into a full retreat depends on where Bitcoin trades next quarter.