Strategy faces Bitcoin sale questions amid dividend debate

• QCP estimated Strategy has enough liquidity to cover dividend payments for about seven and a half months.
• The firm warned that future Bitcoin (CRYPTO:BTC) sales could become an option if dividend obligations exceed available funding sources.
• Strategy CEO Phong Le said the company's recent sale of 32 BTC was a procedural test and not a move to fund dividends.

Strategy could eventually sell additional Bitcoin (CRYPTO:BTC) to support dividend obligations if other funding sources become less attractive, according to market maker QCP, which estimated the company has about seven and a half months of liquidity available for payouts.

The warning follows several recent balance-sheet transactions, including the repurchase of nearly US$1.5 billion in convertible notes due in 2029 and the raising of about US$200 million through sales of MSTR stock.

“The transaction was not driven by a need to raise cash for dividends,” said Strategy CEO Phong Le.

Le said the company's sale of 32 Bitcoin earlier this month was conducted to test internal procedures, generate tax losses that may offset future liabilities and reduce potential market disruption if larger sales are required in the future.

Management will continue evaluating Bitcoin sales and share issuance based on their impact on shareholder value, while following the developments Strategy shares were unchanged and the company continued to hold 846,842 Bitcoin.

QCP said growing attention is focused on how Strategy plans to meet future dividend commitments while maintaining its Bitcoin treasury strategy, with potential asset sales remaining one option available to management.

Critics including Euro Pacific Capital chief Peter Schiff have argued that issuing new shares to acquire additional Bitcoin may dilute shareholders if the stock trades closer to the value of the company's underlying Bitcoin holdings, although Strategy has continued adding to its reserves and recently increased cash holdings to about US$1.1 billion.

At the time of reporting, Bitcoin price was $64,532.49.