Michael Saylor’s firm claims it has enough reserves to sustain decades of dividend payments, though critics remain unconvinced.
The company stated on X that it has about 32 years of dividend coverage backed by its Bitcoin reserve. Based on its figures, this calculation assumes its Bitcoin holdings are worth just under 55 billion dollars, while total dividend obligations stand at around 1.7 billion dollars.
Earlier in November, the company had estimated coverage of up to 71 years, assuming Bitcoin prices remained stable, a condition that has not held. Strategy pays dividends on its STRC “Stretch” product, which offers an 11.5 percent yield and is intended to trade near 100 dollars.
STRC under pressure as yield rises
Recently, STRC has fallen more than 10 percent, pushing its price below the intended benchmark. It dropped further by about 3 percent and touched 89 dollars, close to its lowest recorded level, according to Google Finance. As a result, the effective yield has climbed to about 12.9 percent based on data from BitcoinQuant.
The decline has raised concerns among investors about whether the company may need to sell Bitcoin to meet obligations, increase dilution through its MSTR shares, or risk further reserve strain if prices continue to weaken.
Strategy stock also came under pressure, falling another 5 percent in a single day to 116 dollars. The shares are now down roughly 73 percent from their July 2025 peak.
Criticism over reserve assumptions
Gold advocate and Bitcoin critic Peter Schiff questioned the company’s dividend coverage claims, arguing that the projections rely on several optimistic assumptions, including stable Bitcoin prices, no increase in preferred dividends, and no additional share issuance.
He warned that if the firm begins selling Bitcoin to meet obligations, downward price pressure could accelerate, forcing even larger sales to cover the same liabilities.
Other market commentators echoed similar concerns. Analyst “Kaleo” suggested that reducing exposure sooner could be more sustainable, noting that selling pressure tends to increase the amount of Bitcoin required to raise cash as prices fall. CryptoQuant analyst Darkfost also cautioned that expectations should account for the possibility that forced selling could impact market prices more than anticipated.
Will Strategy be forced to sell Bitcoin?
The company previously sold 32 BTC in late May, which contributed to market uncertainty. However, it also continued accumulating, purchasing 1,587 BTC for about 100 million dollars last week and 1,550 BTC in early June.
Some analysts warn that relying on Bitcoin sales to fund dividend payments could create a negative feedback loop where falling prices trigger more selling pressure. Others argue that strategic buying during dips could help stabilize confidence.
Joe Burnett suggested that if the company allows prices to briefly fall below target levels and then actively buys back, it could condition the market to view those dips as buying opportunities, especially if dividend payments remain consistent and price levels recover quickly.#crypto#cryptonews https://coinsignals.net https://t.me/coinsignalpublic
