Strategy new ‘last resort’ to sell Bitcoin could trigger on 15% dip – sets $1.4B cash reserve contingency
Strategy has established a $1.44 billion cash reserve and detailed conditions under which it might sell Bitcoin as a last resort.Summary
Strategy Inc., formerly MicroStrategy, is adjusting its treasury management as its stock trades at a discount to its Bitcoin holdings' net asset value (mNAV), stalling its previous growth loop of issuing equity at a premium to buy BTC. To manage this, the firm has established a $1.44 billion USD cash reserve, which covers about 21 months of preferred share dividends and interest payments, acting as a buffer against the need for dilutive equity issuance. Chairman Michael Saylor stated this reserve complements their BTC reserve for navigating volatility. Furthermore, Strategy refined its stance on selling Bitcoin, stating sales would only be considered as a last resort if the stock trades below 1x mNAV and capital markets are inaccessible. This threshold is approximately a 15% drop from current levels. While this provides clarity, some analysts warn that selling BTC under these conditions could trigger a "death spiral." The company also revised its forward guidance, abandoning a $150,000 BTC year-end 2025 target for a more conservative $85,000 to $110,000 range.
(Source：CryptoSlate)