MicroStrategy Sells 32 BTC to Fund Preferred Dividends

MicroStrategy sold 32 Bitcoin between May 26 and May 31, generating roughly $2.5 million at an average execution price of $77,135, the company reported. The sale was about 0.0038% of its corporate treasury of 843,706 BTC, which MicroStrategy acquired at an average price near $75,699.

Bitcoin’s market price fell about 4% on the news, trading as low as $69,690 before recovering to roughly $70,120. The filing did not indicate that the transaction tested the company’s ability to liquidate large positions.

MicroStrategy said the proceeds were used to pay distributions on its perpetual preferred shares, including STRC, a security launched in July 2025 that pays monthly cash distributions and currently carries an annualized dividend rate of 11.5%. STRC is designed to trade near a $100 par value; it traded below par in mid‑May, falling to about $97.11 before recovering to near $99.10.

The preferred‑stock program has financed the purchase of more than 122,000 BTC to date. When STRC trades near par, MicroStrategy can sell new shares through its at‑the‑market program on more favorable terms to raise cash, buy Bitcoin and meet dividend obligations.

Glenn Cameron, global head of institutional at Onramp Bitcoin, noted that liquidity is routinely available in normal markets but questioned whether that liquidity would hold during a prolonged price decline when fixed dollar payments are due. He wrote: “Dividends are not paid with mark‑to‑market gains. They require dollars.”

Jeff Dorman, chief investment officer at Arca, pointed to MicroStrategy’s roughly $900 million cash reserve and estimated it covers about five months of dividend obligations at current levels. He warned repeated selling in a falling market could force larger disposals to meet the same dollar amounts and described the arrangement as a “ticking time bomb” for the alignment of interests among common shareholders, preferred holders and Bitcoin investors.

MicroStrategy said selective sales demonstrate the treasury can support the balance sheet and that sales can improve per‑share metrics or meet obligations tied to its securities. Company leaders have presented the preferred offerings as instruments for investors seeking yield rather than direct Bitcoin exposure.

Analysts noted that a lower Bitcoin price would require the sale of more coins to cover the same cash dividend and that continued issuance of preferred shares would raise the company’s fixed cash burden. How the preferred funding model performs if market conditions change remains a focus for investors and analysts.