Billionaire Michael Saylor once said ‘never sell your Bitcoin’ — now his company has given itself permission to sell up to $1.25 billion

Strategy (NASDAQ: MSTR), the enterprise-software firm turned Bitcoin vault and the biggest corporate holder of the cryptocurrency on earth, authorized a program to sell up to $1.25 billion of its Bitcoin to fund its USD reserve. It's the first time the firm has formally explained how and when it might sell, and the move clashes with the "never-sell" identity built by Co-founder and Executive Chairman Michael Saylor, that many others have copied.

Authorizing a sale isn’t the same as selling it. The program doesn't obligate Strategy to sell anything, it just gives them the option, and any sale would depend on the market. But now that the option exists on paper, the company can actually do it, and that’s a notable change.

What Strategy actually authorized

Strategy folded the $1.25 billion cap into a broader plan called the Digital Credit Capital Framework. As of June 28 the company set aside about $2.55 billion in cash, enough to cover roughly 17.4 months of the dividends and interest it pays (about $1.76 billion a year). The framework also requires keeping at least 12 months of that coverage on hand at all times.

If the cash reserve runs low, Strategy can top it up by selling Bitcoin — up to $1.25 billion worth. That cap applies just to refilling the reserve; the program doesn’t set an overall limit and also allows the company to sell coins to cover dividends, interest, or buybacks. At current prices, $1.25 billion is about 21,300 BTC, roughly 2.5% of the company’s 847,363 BTC holdings. The framework also authorizes up to $1 billion for common-stock buybacks and up to $1 billion for preferred shares.

"Strategy remains committed to Bitcoin as its primary treasury reserve asset," Saylor said in the announcement. Chief Financial Officer Andrew Kang added that: "Bitcoin is capital."

Why the funding model stopped working

For years, Strategy had a setup that only worked one way. Its stock traded well above the value of the Bitcoin it held, so the company could sell new shares at that premium, use the money to buy more Bitcoin, and keep repeating the cycle. It never needed to sell Bitcoin because raising cash was easy.

That whole setup depends on the premium, and that premium has mostly disappeared. Bitcoin hit a record high near $126,000 last October before falling below $60,000 this June, while Strategy’s stock is down about 79% over the past year. With that drop, Strategy’s stock no longer commands the hefty premium to its Bitcoin holdings that it once did.

When the stock stops trading at premium, issuing new shares no longer feels like free money, and the bills still come due. Strategy has to keep paying fixed dividends on its preferred stock and interest on its debt, whether Bitcoin is up or down. One of those preferred shares, its Stretch series (NASDAQ: STRC), was pitched by Saylor as something that should stay close to $100, but it closed last Friday around $74. To help support it, Strategy is raising STRC’s dividend to 12%, starting July 1.

In late May, the company sold 32 Bitcoin (its first sale since 2022) to pay a dividend. It was only a tiny slice of its holdings, but even that was enough to upset some of its supporters. This new framework is the company’s bigger attempt to deal with the same problem.

The distinction Saylor keeps drawing

Saylor keeps making one point. His “never sell your Bitcoin” line was always advice to individual holders, not as a promise about what the company would do with its treasury.

"I said to you never sell your Bitcoin," he told a crowd at the Bitcoin Prague conference. "I never said that the company wouldn't sell its Bitcoin."

The trouble is, he didn’t always limit that message to individual holders. For years, he said it about Strategy itself.

Just three months before the company’s first Bitcoin sale in years, he told CNBC that Strategy would keep buying instead of selling, and would refinance debt before it ever touched its Bitcoin.