Bitcoin Treasury Weekly #3: Strategy May Now Sell Bitcoin to fund STRC Dividends

Weekly Overview

For six years, “never sell Bitcoin” was the foundation of Strategy’s entire brand identity — the philosophical bedrock that separated it from every other company playing with treasury allocation. On May 5, during Q1 2026 earnings, he says that Strategy has the option and will consider to sell bitcoin to fund the dividend obligations.

Strategy Chairman Michael Saylor stated during the Q1 earnings call that the firm would consider selling a portion of its Bitcoin holdings to meet dividend payments on its STRC preferred stock, framing the move as deliberate — designed to “inoculate the market” and demonstrate that Bitcoin can function as a productive asset capable of generating cash flows (The Block). The market reacted immediately: MSTR fell over 4% in after-hours trading and Bitcoin dipped below $81,000 following the announcement (Bitcoin.com News).

Meanwhile, institutional accumulation of MSTR equity accelerated. UBS Group acquired an additional 551,121 Strategy shares worth approximately $98 million, bringing its total MSTR position to 6.31 million shares valued at roughly $1.12 billion (Crypto Briefing). And on the other side of the ledger, K Wave Media scrapped its $485 million Bitcoin treasury plan entirely, redirecting the capital into AI infrastructure (CoinDesk), reminding the market that not everyone who announced a Bitcoin treasury strategy in 2025 had the conviction or capital structure to sustain it.

Key Events & Announcements

Strategy — Q1 2026 earnings: $12.54B loss, 9.4% BTC yield, STRC at $8.5B market cap

•      Strategy reported 818,334 BTC holdings as of May 3 — 22% growth year-to-date — with a 9.4% BTC Yield and $11.68 billion raised year-to-date. STRC raised $5.58 billion YTD (189% growth) and paid $692.5 million in cumulative preferred dividends since launch (Business Wire).

•      The $12.54 billion net loss was almost entirely accounting-driven — a $14.46 billion unrealized loss on digital assets as Bitcoin slid toward $62,000 during February’s drawdown. The underlying software business grew modestly, with Q1 revenues of $124.3 million, up 11.9% year-over-year (Blockhead).

•      In April alone, 83% of capital raised came from STRC digital credit versus 17% from common equity. STRC’s ATM velocity reached a record $2.2 billion raised in a single week (Biggo Finance).

UBS — $98M additional MSTR purchase, $1.12B total stake

UBS held 2.52 million MSTR shares worth $415 million as of January. In February, the bank nearly doubled its stake to 5.76 million shares worth $805 million. Its latest purchase brings the total to 6.31 million shares worth roughly $1.12 billion (U.Today). UBS is now one of the largest single institutional holders of Strategy equity in the world.

Swiss National Bank — $9M MSTR top-up, now 766,100 shares

The Swiss National Bank purchased an additional 50,720 shares of Strategy in a transaction valued at roughly $9 million — a roughly 7% increase, bringing its total stake to 766,100 shares worth about $138 million. The SNB has held Strategy shares since at least 2013 and dramatically ramped its position from approximately 46,600 shares to 468,200 shares in September 2024 — a surge of more than 900% — all while publicly rejecting direct Bitcoin purchases (Bitcoin Treasuries).

K Wave Media — $485M Bitcoin treasury scrapped, pivots to AI

K Wave Media redirected up to $485 million from a planned Bitcoin treasury strategy into AI infrastructure, including data centers, GPU compute, and acquisitions, under an amended deal with Anson Funds. The pivot reversed a 2025 plan to use a $500 million facility to buy BTC. K Wave shares fell 24% on Monday and continued sliding in premarket on Tuesday (CoinDesk).

Bitcoin digital credit — $3 trillion market opportunity framed at Consensus

Executives from Bitcoin treasury firms at Consensus in Miami outlined a $3 trillion opportunity in Bitcoin-backed digital credit instruments — noting about $10 billion of digital credit had been issued in under a year, calling it one of the fastest product launches in capital markets history. The long-term opportunity is tied to the global $300 trillion credit market, where even a 1% Bitcoin allocation implies roughly $3 trillion in demand (CoinDesk).

Deep Dive Insight

Deep Dive 1: The “never sell” pivot — signal, not surrender

What happened: During Strategy’s Q1 earnings call, Saylor said: “We will probably sell some bitcoin to pay a dividend just to inoculate the market and send the message that we did it.” CEO Phong Le reiterated the message, framing active balance sheet management as the path to maximizing Bitcoin per share value (Yahoo Finance).

Why it matters: The “never sell” doctrine was never just a treasury policy. It was a trust signal. It told preferred shareholders, convertible note holders, and institutional buyers of STRC that their capital would never be used to trigger forced Bitcoin liquidation. The moment you introduce optionality around Bitcoin sales — even framing them as accretive — you change the psychological contract with every stakeholder.

Saylor’s precise framing was that the company’s current position requires Bitcoin to appreciate at just 2.3% annually for existing holdings to cover STRC dividend obligations indefinitely, without selling any common stock. The firm can stop selling MSTR common stock immediately and fund dividends through Bitcoin sales instead — an approach that would allow Strategy to buy more Bitcoin than it sells to cover STRC’s obligations, which have raised $8.5 billion since launch (The Block).

The math is compelling. The messaging is more complicated.

Strategy carries roughly $1.5 billion in annual dividend and debt-related obligations, with approximately 18 months of USD reserves to cover them at current run-rates (Blockhead). That’s not a distressed position. But the acknowledgment that Bitcoin may be sold to cover obligations — even framed as a deliberate, accretive choice — signals that the model is entering a new phase. One where the purity of the accumulation story is being traded for operational flexibility.

If Bitcoin appreciates, this is a non-event. If Bitcoin enters a sustained drawdown, this disclosure becomes the justification for sales that erode the conviction premium currently embedded in STRC’s market cap.

Deep Dive 2: UBS and the SNB — Europe is buying the proxy, not the asset

What happened: Two of Switzerland’s most significant financial institutions — one commercial, one central bank — both added to their MSTR positions this week, at different scales but with the same structural logic.

Why it matters: MSTR is a Nasdaq-listed stock that fits perfectly within the investment regulatory frameworks of traditional banking. By holding MSTR, these institutions can legally link reserves to Bitcoin’s long-term upside without navigating private key management or custodial security. The automatic accretion of BTC Yield intrigues institutions most — through issuing debt to acquire Bitcoin, the “Bitcoin per share” continues to grow automatically, serving as a built-in hedge against fiat currency inflation (TradingKey).

This is the core insight the market is still underpricing. UBS is not making a speculative bet on MSTR’s software business. It is, functionally, buying a managed Bitcoin position with daily liquidity, SEC oversight, audited financials, and no custody risk. The SNB is doing the same thing while its president publicly states Bitcoin has no place in official reserves.

The divergence between public statements and portfolio actions at European central bank level is significant. When institutions say one thing and do another, the portfolio action is always the more honest signal.

UBS went from an $800 million MSTR stake to $1.12 billion in a matter of months. For traditional finance institutions that want Bitcoin exposure without directly holding the asset, Strategy remains the most obvious vehicle (Crypto Briefing). As more institutions reach that conclusion, the demand base for MSTR equity deepens.

Market Trends

The “never sell” era is over. Active treasury management is the new standard.

Strategy’s pivot reframes what Bitcoin treasury companies are. They are no longer passive accumulators whose primary virtue is holding at all costs. They are active capital allocators who use Bitcoin as a reserve asset, with the flexibility to optimize its deployment. That’s a more sophisticated model — but it requires more sophisticated investor trust.

European institutional capital is becoming a structural pillar.

Between AIMCo last week, UBS at $1.12 billion, and the SNB quietly adding shares while publicly dismissing Bitcoin, a pattern is forming. Major non-US institutions are building MSTR positions as their sanctioned path to Bitcoin exposure. This demand base doesn’t need Bitcoin to hit new highs to grow — it grows as more compliance teams approve the trade.

The Bitcoin treasury model is bifurcating — serious operators vs. opportunists.

K Wave’s reversal is the clearest signal yet that the 2025 wave of Bitcoin treasury announcements included many companies chasing capital market momentum rather than executing a genuine long-term strategy (crypto.news). A company that raises $500 million to buy Bitcoin and redirects it to AI infrastructure eleven months later was never a Bitcoin treasury company. It was a narrative vehicle. The exits are clarifying who was serious.

Digital credit is emerging as the dominant capital markets theme.

$10 billion of Bitcoin-backed digital credit issued in under a year represents one of the fastest product launches in capital markets history (CoinDesk). STRC is the leading instrument, but the infrastructure being built around Bitcoin-collateralized lending, yield strategies, and credit products is opening a new asset class. That transition — from Bitcoin as treasury reserve to Bitcoin as credit collateral — is the next structural shift worth watching.

My Commentary

In my view, the most significant sentence spoken in the Bitcoin treasury space this week was not about a purchase. It was Saylor saying “we’ll probably sell some bitcoin to pay a dividend.” Might have been a shock to many investors and some may like it, some may not.

I want to be precise about what this does and doesn’t mean. It does not mean Strategy is abandoning its Bitcoin position. Management’s stated goal is to double Bitcoin per share within seven years through digital credit — and the company is already at a 9.4% BTC yield year-to-date against a 10% annual target (Motley Fool). The mechanics are working. The direction hasn’t changed.

What stands out to me is that UBS and the SNB keep buying regardless. A $1.12 billion position and a $138 million position from institutions that weren’t built to speculate suggest that conviction around MSTR as a Bitcoin proxy has deepened faster than the risks around the “never sell” reversal have spread. For now, institutional demand is absorbing the philosophical shift without hesitation.

I think the market is underestimating K Wave’s significance as a leading indicator. Every company that exits the Bitcoin treasury model under pressure reveals something about how fragile the 2025 cohort of adopters actually was. The survivors will be the ones with genuine capital market infrastructure — preferred equity programs, diversified investor bases, and the operational capacity to issue and redeploy capital continuously. K Wave had none of those things. Most of the 2025 cohort doesn’t either.

6. What to Watch Next Week

•      Metaplanet Q1 Earnings — First quarter earnings report to be announced on May 13, 2026. Keep an eye out for any clues regarding developments of the progress of preferred shares such as MARS and MERCURY.

•      UBS next 13F filing — at $1.12 billion and growing, UBS’s MSTR position is now large enough to be a market signal in its own right. Any further increase would confirm European TradFi conviction. A reduction would deserve scrutiny.

•      Bitcoin price trajectory — Strategy’s average cost basis sits at $75,537 per coin. As of early May, the market value stood at approximately $64.14 billion against a cost of $61.81 billion (Yahoo Finance) — a thin cushion. A sustained move above $85,000 opens the door to new MSTR equity issuance at elevated mNAV. A move back below $72,000 would compress the cushion and likely delay new preferred issuance.

Bitcoin Treasury Weekly is published every Friday. Nothing in this article constitutes financial advice. All data sourced from public company filings and verified media reports as of May 9, 2026.