As part of a recently published detailed analysis, the on-chain analytics platform CryptoQuant (NASDAQ:MSTR) highlighted increasing financial difficulties Strategyleading Bitcoin-focused firm led by Michael Saylor. Researchers noted a significant deterioration in the company’s liquidity position due to increased dividend obligations on preferred stock (STRC) and a significant decrease advance holdings.
According to the report, these pressures reduced the dividend cover from more than seven years ahead of the year to about 14 months, raising questions about the sustainability of the firm’s aggressive Bitcoin purchasing strategy.
Strategy advance reserves have decreased by approximately 38% since the beginning of 2026, due in part to actions such as the early repurchase of $1.5 billion of convertible senior notes.
At the same time, annual dividend commitments have nearly quadrupled to roughly $1.2 billion, largely due to the expansion of the issuance of preferred shares used to fund Bitcoin purchases.
Analysts estimate that restoring a more comfortable 24-month dividend coverage would require increasing cash reserves to about $2.8 billion, nearly double current levels.
This buffer is seen as necessary to restore market confidence in the company’s capital structure.
CryptoQuant emphasized that forced sales of Bitcoin assets to address liquidity gaps would be highly undesirable.
The firm currently carries significant unrealized losses, estimated at $10.6 billion, on Bitcoin purchased between 2024 and 2026, as many positions were entered at higher prices.
Realizing these losses at current market rates could erode shareholder value and undermine the long-term Bitcoin treasure thesis.
The analysis offered broader strategic guidance beyond immediate liquidity recommendations.
CryptoQuant proposes large-scale pause Bitcoin purchases until reserves and coverage metrics improve.
He also advocated a shift away from opportunistic buying, which is often criticized in market commentary as being close to local highs, to a more disciplined, pattern-driven framework for timing purchases.
This systematic method can better align purchases with favorable market conditions and reduce the perception of inefficiency.
Additionally, experts suggested creating a clear profit-taking protocol for future bull markets.
Sell parts selectively Bitcoin Holding during uptrends can help deleverage the balance sheet, create cash reserves (“dry powder”) for opportunistic purchases during a downturn, and generate profits without abandoning the core Bitcoin strategy.
CEO of CryptoQuant Ki Young Ju He reinforced these points on social media, stating that in the current high selling pressure conditions, continuous buying acts as a liquidity absorber rather than a catalyst for price appreciation.
Despite hundreds of billions of dollars of capital inflow and growth BitcoinDue to the realized capitalization of , prices remained largely range-bound.
This perspective underlines a tension. StrategyModel: While belief-driven accumulation has removed significant amounts of Bitcoin supply from circulation, sustained buying during increased seller activity may be delaying a healthier market reset that includes the capitulation and reaccumulation phases typical of past cycles.
A more balanced framework can increase resilience without compromising the firm’s performance. Bitcoincentered view.
Like Bitcoin The markets are in a long-term horizontal movement, CryptoQuant‘s insights underscore the importance of prudent treasury management for institutional players. The strategy’s response to these recommendations could impact both stock performance and more broadly. Sunday dynamics.
