CoinDesk
CryptoQuant is telling Strategy to stop buying bitcoin and start rebuilding the cash buffer that backs its STRC preferred stock. The on-chain analytics firm says the reserve funding STRC's 11.5% dividend has thinned from more than seven years of coverage to roughly 14 months, while annual dividend obligations have nearly quadrupled to $1.2 billion since the start of 2026. STRC traded around $82.50 last week, a record 17.5% below its $100 par value, and the company is sitting on a $10.6 billion unrealized loss on coins bought in 2024, 2025, and 2026.
Why it matters
The warning is structural, not cyclical. Strategy's USD reserve is down 38% year-to-date after a $1.5 billion May buyback of convertible notes drained the buffer that supports STRC. CryptoQuant's prescription is to pause accumulation, lift reserves back to roughly $2.8 billion (24 months of coverage), and only then return to a systematic cadence tied to market conditions rather than capital raises. The call cuts directly against the relentless-buying identity Michael Saylor has built around the company since 2020, a posture that has grown the treasury to about 847,000 BTC.
Market impact
The squeeze is showing up in two places at once. STRC's slide is the visible signal, but the deeper read is that STRC dividends are cumulative, so any skipped payment would still have to be made up later, and CryptoQuant does not expect Strategy to suspend them because doing so would damage credibility with the preferred holders it needs to keep issuing. Benchmark-StoneX analyst Mark Palmer pushed back this week, arguing the funding engine has become less efficient rather than broken and rejecting comparisons to Terra's collapsed stablecoin. The next data points to watch are STRC's price relative to par and the next reserve disclosure: if coverage slips below 12 months or STRC prints fresh lows near $80, the CryptoQuant thesis stops being advisory and starts looking like a forecast.
Frequently asked questions
-
What is CryptoQuant saying Strategy should do?
CryptoQuant is recommending Strategy pause its bitcoin accumulation, rebuild its USD reserve to roughly $2.8 billion (about 24 months of dividend coverage), and only then resume systematic purchases rather than buying whenever it raises capital.
-
How bad is the STRC situation right now?
STRC traded around $82.50 last week, a record 17.5% below its $100 par value. Annual dividend obligations have nearly quadrupled to $1.2 billion since the start of 2026, and the USD reserve is down 38% year-to-date, leaving roughly 14 months of coverage versus more than seven years earlier.
-
What is Strategy's unrealized bitcoin loss?
CryptoQuant puts the unrealized loss on Strategy's bitcoin stack at $10.6 billion, with every coin bought in 2024, 2025, and 2026 sitting underwater at current prices.
-
Could Strategy be forced to sell bitcoin?
CryptoQuant says a forced sale is unlikely soon. Strategy is not required to sell BTC to defend STRC and can raise the dividend or issue new shares to signal it can keep paying, tools it is already using.
-
What is the disagreement with Benchmark-StoneX?
Benchmark-StoneX analyst Mark Palmer rejected comparisons between STRC and Terra's collapsed stablecoin and argued Strategy's funding engine has become less efficient rather than broken, a notably softer read than CryptoQuant's call to halt accumulation entirely.
Crypto News
WatcherGuru
CryptoSlate
TheBlock
WuBlockchain
Lookonchain
CoinTelegraph