Galaxy tells Strategy: stop panic-selling $BTC and start lending it 🍯

Strategy's new monetization framework drew cautious approval from Galaxy Research, with Head of Research Alex Thorn saying markets "like" the plan but warning that it does not eliminate the underlying "structural risks" facing the largest corporate Bitcoin treasury. Under the framework, Strategy raised $1 billion in cash and formalized a 12-month cash reserve buffer, providing roughly 17 months of coverage for its obligations, while also approving the sale of up to $1.25 billion in BTC to meet interest commitments.

The announcement drove a sharp relief rally across Strategy's capital stack. Common stock MSTR climbed from $82.50 to $100, and preferred STRC jumped 26%, from a record low of $71 to $90. STRC remained below its $100 peg, but Thorn said the rebound reflected positive market sentiment toward the new plan.

Galaxy cautioned that the framework provides only a temporary cushion. Thorn noted that Strategy still carries a large preferred stack and recurring obligations, and that $6.7 billion in converts will mature over the next two years. He warned that further BTC sales would risk amplifying weakness in both MSTR and STRC.

Thorn outlined a fourth option that he said a company holding 847,363 BTC should consider: generating income from the stack through limited BTC lending or options strategies rather than spot sales. He cited Metaplanet, which has used options strategies for cash flow and BTC accumulation, as evidence that the approach can work. Galaxy framed the proposal as a "middle ground" that avoids diluting MSTR holders and does not require spot $BTC sales.

The recommendation diverges from JPMorgan analysts, who have urged Strategy to expand its cash reserve buffer from 17 months to two or three years by issuing more MSTR rather than selling Bitcoin. Galaxy's Thorn argued that, if risks are managed, lending and options income could raise more cash flow to cover obligations without affecting MSTR common holders or the underlying $BTC stack.