Strategy, a prominent corporate holder of Bitcoin, has clarified its position regarding the potential sale of its substantial Bitcoin reserves, emphasizing that such a move would only occur under extreme financial duress. The company's CEO, Phong Le, outlined a stringent set of conditions, underscoring that any divestment would be a measure of last resort, guided by financial discipline rather than a shift in long-term strategy.
When Bitcoin Sales Become a "Last Resort"
Phong Le explained that Strategy would only consider selling Bitcoin if its stock price, specifically its multiple of net asset value (mNAV), plummeted below one, and all other avenues for securing fresh capital were exhausted. In such a scenario, disposing of a portion of its Bitcoin holdings would be a "mathematically" justified decision aimed at protecting "Bitcoin performance per share" for shareholders. Despite this pragmatic approach, Le expressed reluctance, stating he would not wish Strategy to be "the company that sells Bitcoin," yet affirmed that financial discipline must ultimately prevail over emotional attachment during hostile market conditions.
Strategic Capital Raising and Financial Commitments
Strategy's core business model revolves around raising capital when its shares trade at a premium to its net asset value, subsequently using these funds to acquire more Bitcoin, thereby increasing Bitcoin per share. The company faces significant annual dividend obligations, estimated at $750-800 million, tied to preferred stock issues. Le plans to fund these payments primarily through capital raised at a premium to the mNAV. He believes that consistently meeting these dividend payments, even in a down market, will ultimately bolster investor confidence and stock prices, making asset sales less likely.
Unwavering Long-Term Vision and Investor Confidence
Beyond the immediate balance sheet mechanics, Strategy maintains an ardent long-term thesis on Bitcoin, viewing it as a scarce, non-sovereign asset with universal global appeal. The company recently launched a "BTC Credit" dashboard to further reassure investors, emphasizing its sufficient dividend coverage for decades, even if Bitcoin prices remain stable. Strategy asserts that its debt remains well-covered, even if Bitcoin were to fall to its average purchase price of approximately $74,000, and would remain manageable even at a price as low as $25,000, reinforcing its commitment to its Bitcoin-centric strategy.
