Strategy's $1.5B Dividend Tab Has Saylor Selling Bitcoin to Pay the Piper 💸

Grayscale's head of research has publicly warned that Michael Saylor's Strategy is confronting a structural $1.5 billion annual cash-flow problem driven by its expanding preferred-stock dividend obligations rather than by Bitcoin's price. Zach Pandl issued the warning after SEC filings confirmed that Strategy sold 32 BTC for approximately $2.5 million between May 26 and May 31, 2026, its first Bitcoin sale since 2022, with the proceeds directed toward funding preferred-stock distributions. "Strategy's leveraged business model is facing challenges, which have contributed to increased volatility in the overall BTC market," Pandl said in a Grayscale research note, deliberately separating the issue from the usual BTC price narrative.

The arithmetic underlying the warning centers on Strategy's 2025 software revenue of roughly $477 million, which is less than one-third of the approximately $1.5 billion in annual dividends now owed across its five preferred-stock series. The preferred stack itself has grown from approximately $730 million in early 2025 to roughly $15.5 billion by mid-2026, fueled by successive issuances that include STRK, which carries a fixed coupon of about 8%, and STRC, the "Stretch" preferred issued in 2025 at a variable rate of approximately 11.5%. STRC was designed to trade near its $100 par value but has been quoted around $95–96.

Pandl framed that below-par print as a signal that investors are already demanding higher effective yields, which could compel Strategy to sweeten dividend terms on future issuances. "If Strategy is forced to increase the dividend to return STRC to $100, the company will run out of cash much sooner, pulling forward Bitcoin sales to fund payments," he said. Strategy's reported cash position of roughly $1 billion covers less than one year of preferred dividends at current obligation levels, leaving a runway that Pandl characterized as insufficient to paper over the gap.