Strategy Bitcoin Sale Did Not Tap $1.25B Plan

Sale Classified as Dividend Payment, Not Reserve Funding

Strategy's $135 million Bitcoin sale last week did not draw down the company's newly approved $1.25 billion BTC Monetization Program, according to VanEck Head of Digital Assets Research Matthew Sigel. Sigel stated that the sale does not count against the $1.25 billion Monetization Program, because only cash reserve-funding sales are included in that program, while direct dividend payments are not.

Strategy's board authorized the BTC Monetization Program to allow the company to sell Bitcoin from time to time, with one primary purpose being to generate up to $1.25 billion to fund its USD Reserve. The program, unveiled on June 29, remained fully available as of July 5. The $135 million transaction was instead processed as a direct preferred shareholder dividend payment, placing it outside the program's scope entirely.

As a result, Strategy has greater Bitcoin selling flexibility than the stated $1.25 billion limit implies. The distinction matters: investors tracking how much of the monetization ceiling has been consumed will need to account for dividend-linked sales separately.

Strategy's Bitcoin Holdings and Dividend Pressures

Strategy currently holds 847,363 $BTC, according to its most recent Form 8-K filing. Annual dividend payments tied to the company's preferred stock now exceed $1.5 billion, a recurring cash demand that does not pause when Bitcoin prices decline.

Strategy's Form 8-K disclosed a Board-authorized BTC Monetization Program allowing the company to sell Bitcoin to fund a $2.55 billion USD Reserve, cover preferred dividend and interest payments, and finance up to $2 billion in combined securities repurchases. Based on the $2.55 billion USD Reserve and $1.25 billion of Board-authorized reserve-building BTC monetization capacity, Strategy would have approximately $3.80 billion of total current preferred stock dividend liquidity coverage, representing approximately 25.9 months of coverage.

Sigel has been among the more vocal institutional voices scrutinising Strategy's evolving capital structure. He said the new framework, which permits the company to sell Bitcoin for the first time, has changed the nature of what investors own, and questioned whether the stock deserves a premium to its net asset value. His latest clarification on the $135 million sale, however, offers some reassurance that the formal monetization ceiling remains untouched for now.

Sources:
Strategy Official Press Release: BTC Monetization Program Announcement
Decrypt: Strategy Sells $216M in Bitcoin for Dividends Under BTC Monetization Program
Yahoo Finance: VanEck's Sigel Says Strategy Is Now a Hedge Fund