Strategy Sells Bitcoin for the First Time Since 2022

Strategy Inc. sold roughly $2.5 million of Bitcoin, its first sale of the asset since 2022. The amount is trivial. The signal is not. Shares slid nearly 5% in Monday premarket trading after the regulatory filing hit.

The company parted with 32 BTC. Set against the roughly $61 billion in Bitcoin still on its balance sheet, that is a rounding error, and Strategy remains by far the largest corporate holder of the asset. What makes the sale matter is who made it. For years Michael Saylor, the co-founder who rebuilt the former software company into a Bitcoin accumulation machine, assured shareholders that Strategy would not sell. Last month, on the quarterly earnings call, he began walking that promise back.

Strategy framed the disposal as housekeeping. Proceeds go toward distributions on its preferred stock, the payouts owed to investors who hold that class of shares. Future sales, the firm said, are part of a plan to accumulate Bitcoin more deliberately rather than abandon it. There are tax benefits, the company noted. Selling into weakness now, it argued, could make buying easier during a long downturn in digital assets.

Not everyone reads it that kindly. "MicroStrategy did sell a 'test' amount into the market of 32 BTC, very small by comparison with their holding but nonetheless a bad, if not inevitable market signal," said Stephen Wundke, strategy and revenue director at Algoz Technologies. "Without a rally in the coming weeks there is no doubt more will follow."

The timing carries the weight. The digital asset treasury model Saylor pioneered in 2020, raise money against your own stock, buy Bitcoin, repeat, has been under strain since crypto prices broke last October. A test sale of 32 coins settles one question and sharpens another. What happens if the rally Wundke is waiting for never arrives?