Strategy’s New Capital Plan Addresses Liquidity, But Key Bitcoin Strategy Gaps Remain, Says CryptoQuant

Strategy’s recently unveiled capital management plan has helped resolve the company’s immediate liquidity concerns, but the firm still lacks clear rules for when to buy and sell bitcoin, according to research from CryptoQuant. Analyst Julio Moreno said the company still needs to define a systematic model for timing bitcoin purchases, along with a disciplined approach for selling into strength during future market rallies.

Five-Part Framework Rebuilds Cash Reserves

Announced in late June, the framework includes a dedicated dollar reserve set aside solely for preferred dividends and interest payments, with a target of maintaining at least 12 months of coverage. The plan also raised dividends on preferred shares to 12%, subject to monthly review, while authorizing up to $1 billion each in preferred-share and common-stock repurchases. A separate program allows the company to raise additional funds through limited bitcoin sales to support these obligations.

Early Actions Show Meaningful Progress

Since introducing the framework, Strategy sold a portion of its bitcoin holdings to raise roughly $216 million, followed by an equity raise of nearly $467 million, without conducting further bitcoin transactions. These moves more than doubled the company’s dividend coverage timeline and significantly boosted its cash reserves, while its total bitcoin holdings remained unchanged. Preferred shares have also recovered notably from recent lows, though they remain below their target value.

Two Major Questions Still Unresolved

Despite this progress, Moreno noted that Strategy has yet to establish a systematic, valuation-based approach for deciding when to resume bitcoin purchases, warning that without one, the company risks repeating past patterns of buying near market peaks. Similarly, the current framework lacks a defined strategy for selling bitcoin strategically during future bull markets, an approach that could help the company realize gains, reduce leverage, and build reserves for future accumulation at lower prices. Moreno described this ongoing gap as the missing second half of a complete capital management strategy.