Strategy offloaded $216 million in bitcoin last week, the largest disclosed sale since Michael Saylor began accumulating the company's position in 2020. A form 8-K filed with the Securities and Exchange Commission shows the company sold 3,588 bitcoin between June 29 and July 5, partly at a loss to its cost basis of $75,476 per coin. The sale split into two tranches: 1,363 bitcoin for $80.8 million at an average of $59,256 through June 30, then 2,225 bitcoin for $135.2 million at an average of $60,773 through July 5.
The cash went to fund distributions on Strategy's preferred stock and replenish its dollar reserve, which stood at $2.55 billion as of July 5. Strategy now holds 843,775 bitcoin, worth roughly $53 billion at current prices. The company acquired those holdings at an average cost of $75,476 per coin.
This marks the first real test of a financing overhaul Strategy announced June 29. The company granted itself authority to sell up to $1.25 billion in bitcoin, launch two separate $1 billion buyback programs for common and preferred shares, and manage liquidity more flexibly. That restructuring arrived under pressure: Strategy's preferred shares trade well below their $100 par value, most recently around $89, signaling the capital structure that funded years of aggressive buying has begun to strain.
The earlier framework had locked Strategy into buying bitcoin with borrowed dollars, a strategy that worked when leverage was cheap and bitcoin climbed. As interest rates stayed high and the company's cost of capital tightened, the arithmetic shifted. The new overhaul gives Saylor room to rebalance without committing to sell large chunks of the core bitcoin position. Authorized sales of $1.25 billion leave roughly $1.04 billion in headroom under the new framework.
The timing is worth noting. Strategy faced pressure on two fronts: preferred shareholders expected distributions, and the company's cash position had thinned enough that executives needed a buffer. Selling 3,588 bitcoin at prices below their cost basis reveals the bind. The company chose to sell rather than tap debt markets again or cut preferred dividends, a choice that trades immediate liquidity for realized losses on the books.
The capital restructuring is not a signal that Strategy plans to exit bitcoin or abandon Saylor's stated strategy of holding the majority of its assets in the coin. It is instead a mechanical fix: the company ran into the limits of leverage financing and borrowed to fund buybacks and distributions, so it is now selling some bitcoin to reduce that reliance. Whether the $1.25 billion authorization is enough, or whether Strategy will need to revisit its capital structure again, depends on how long interest rates remain elevated and how quickly the preferred shares recover to par.