Strategy Still Needs Clear Bitcoin Buy and Sell Rules, CryptoQuant Says

• CryptoQuant believes Strategy improved liquidity through its capital management framework but still lacks disciplined Bitcoin trading rules for long-term stability.
• Strategy rebuilt cash reserves to nearly $3 billion while maintaining 843,775 Bitcoin holdings without additional transactions under framework provisions unchanged.
• CryptoQuant urged Strategy to establish valuation-based buying models and structured profit-taking plans across market cycles for stronger capital discipline.

 

CryptoQuant believes Strategy has addressed its short-term liquidity concerns, but the company still lacks a disciplined framework for buying and selling Bitcoin. The analytics firm praised Strategy’s latest capital management plan while identifying two major gaps that could influence its long-term investment approach.

According to CryptoQuant Head of Research Julio Moreno, the company’s Digital Credit Capital Framework represents a meaningful improvement in financial management. However, he noted that Strategy has not established a systematic model for deciding when to accumulate Bitcoin or reduce its holdings during favorable market conditions. Those missing guidelines remain important because they could help Strategy manage risk while improving shareholder value across different market cycles.

Also Read: Bank of America Makes Massive Bitcoin Shift While Ethereum Holdings Collapse

Liquidity Improvements Strengthen Strategy’s Financial Position

Strategy introduced its five-part Digital Credit Capital Framework on June 29 to reinforce its balance sheet and protect preferred shareholders. The framework established a dedicated U.S. dollar reserve that covers preferred dividends and interest payments for at least 12 months.

Additionally, the company increased the dividend on STRC preferred shares to 12%, with monthly reviews designed to support the stock’s return toward its $100 par value. Strategy also approved up to $1 billion in preferred-share repurchases and another $1 billion in common-stock buybacks whenever management considers those transactions beneficial.

Besides that, the framework created a Bitcoin monetization program allowing sales of up to $1.25 billion. Those proceeds can replenish cash reserves, fund dividend obligations, pay interest expenses, or finance future share repurchases.

According to Moreno, Strategy has already implemented part of that plan. The company sold approximately 3,588 Bitcoin between June 29 and July 5, generating roughly $216 million. Moreover, it raised another $466.7 million through MSTR share sales during the following week while making no additional Bitcoin transactions.

Consequently, Strategy increased its U.S. dollar reserve from approximately $1.44 billion to nearly $3 billion. Dividend coverage also expanded from roughly 14 months to about 29 months. Meanwhile, the company’s Bitcoin holdings remained unchanged at 843,775 BTC because it neither purchased nor sold additional coins after the initial transaction.

STRC shares also recovered from nearly $75 in late June to around $88 following the framework’s introduction. However, Moreno noted that the preferred shares still trade below their $100 par value, suggesting investors remain cautious despite the financial improvements.

CryptoQuant Points to Two Remaining Gaps

According to Moreno, Strategy has not explained when it intends to resume Bitcoin purchases. He emphasized that the new framework governs how the company raises capital rather than how it determines attractive Bitcoin entry points.

Moreover, Moreno warned that operating without a valuation-based accumulation model could expose Strategy to buying Bitcoin during less favorable market conditions. He added that disciplined purchasing rules would help prevent repeating previous buying patterns.

CryptoQuant also highlighted the absence of a structured plan for reducing Bitcoin holdings during future bull markets. While the monetization program supports liquidity needs, it does not establish a strategy for partial profit-taking or balance sheet management when Bitcoin prices climb significantly.

Conclusion

CryptoQuant maintains that Strategy has made meaningful progress by rebuilding its cash reserves and strengthening dividend coverage. Nevertheless, the research firm believes clearly defined rules for both Bitcoin accumulation and strategic selling remain necessary to complete the company’s long-term capital management framework.

Also Read: Tom Lee Explains Why Ethereum Is Becoming AI’s Decentralized Backbone

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