Strategy realizes $102M in Bitcoin losses as dividend pressure mounts

Strategy realized more than $102 million in losses selling Bitcoin below its $75,400 cost basis, ending the "never sell a satoshi" doctrine that defined its four-year accumulation run. The company, formerly MicroStrategy, has now sold Bitcoin for four consecutive weeks, according to CryptoQuant analysts who tallied the cumulative realized losses from the 2026 monetization program.

The most recent disclosure, covering the week ended Aug. 9, showed a sale of 1,690 bitcoin for $108.6 million, an average of roughly $64,262 per coin, well below the company's blended cost basis near $75,400. A separate sale of about $218 million in bitcoin was made to cover preferred-stock dividend obligations, the first time the company sold its reserve to meet financial commitments rather than as a discretionary decision.

The sales fund $1.2 billion in annual preferred-stock dividend obligations on its STRC shares, whose cash coverage has collapsed from more than seven years to about 14 months, per CryptoQuant. Restoring even a 24-month cushion would require an estimated $2.8 billion in reserves, nearly double what the company holds today.

The dividend spiral behind the selloff

The shift traces to the financial engineering that funded the accumulation. Strategy issued roughly $7 billion in convertible notes between 2020 and 2025, along with multiple tranches of preferred stock and billions in at-the-market equity offerings. When Bitcoin's price rose, the appreciation inflated its balance sheet, supported its stock price, and allowed fresh issuance to buy more. When Bitcoin fell from $108,000 in January to $63,800 in August, the flywheel reversed.

The company's software business, generating about $500 million in annual revenue, could not cover the preferred dividends from cash flow alone. With the stock down nearly 40 percent this year to trade in the low-to-mid $90s, issuing new common shares would be highly dilutive — its market value has settled below a net asset value multiple of 1. The board has authorized up to $1.25 billion in total sales, leaving room to keep selling if conditions require.

The accounting hit compounds the pressure. Under the FASB fair-value rules that took effect in January 2025, Strategy marks its crypto holdings to market each quarter. The company swung from a $14 billion profit to an $8.22 billion net loss in the second quarter, driven almost entirely by fair-value markdowns on its roughly 840,000 bitcoin. CryptoQuant estimates unrealized losses across positions built between 2024 and 2026 near $10.6 billion.

Why ETF inflows have absorbed the selling

Strategy's selling has not crashed the price because spot Bitcoin ETFs have absorbed the supply. Bitcoin spot ETFs held about $62 billion in assets under management by August, with daily inflows averaging roughly $150 million in 2026. A single strong day of ETF inflows can exceed $300 million, dwarfing Strategy's $104 million sale of 1,637 bitcoin in its most recent weekly disclosure.

The equilibrium is fragile. If ETF inflows slow below $100 million a day while Strategy keeps selling, the same volume would land in a thinner market and produce a meaningful price decline. CEO Phong Le's Aug. 11 description of Strategy as "the central bank of Bitcoin" — a phrase that carries the implication that central banks sometimes sell reserves — has drawn fresh scrutiny to a treasury strategy built on one asset staying above cost.

Whether the sales mark a structural break or a temporary liquidity fix will show in the weekly 8-K filings. A return to net buying would signal the pressure has eased; continued selling would confirm the shift and compress the stock's premium to net asset value toward parity. Marathon Digital, another large corporate holder, was flagged by on-chain analytics for large transfers from its wallets in the same week, raising the question of whether the corporate treasury sector is moving in sync.

This article is for informational purposes only and does not constitute investment advice.