The common shares of Strategy (MSTR) fell below $100 on Wednesday for the first time since March 2024, extending losses as Bitcoin’s (BTC) prolonged decline continues to weigh on investor perceptions of the company’s leveraged crypto strategy.
The company’s MSTR stock closed trading at $94, reflecting a 9.3% decline. The drop stems from growing concerns about the impact of lower Bitcoin prices on Strategy’s balance sheet and its ability to sustain the financing used to fund its purchases.
Bitcoin bear pressure triggers dip in Strategy’s MSTR and STRC securities
The decline in MSTR comes days after Strategy’s preferred stock, STRC, recorded its largest discount to par value since launch. CryptoQuant analysts stated that STRC fell to $82.50 last week, representing a record 17.5% discount to its $100 par value.
The onchain analytics firm attributed the decline to a combination of Bitcoin bear pressure and a sharp reduction in the company’s cash reserves.
“The decline was amplified by a simultaneous depletion of Strategy’s USD cash reserve in May, as the company repurchased $1.5 billion aggregate principal of its 0% Convertible Senior Notes due 2029,” the analysts wrote.
The note repurchase reduced the cash reserve that investors viewed as a key support for Strategy’s preferred stock dividend obligations.
CryptoQuant noted that STRC is structured to trade near its $100 par value, with Strategy able to raise the stock’s dividend yield to attract buyers whenever the price falls below that level. However, the analysts mentioned that the mechanism is now being tested more severely than ever before as the stock continues to trade at a steep discount.
Liquidity pressures emerge after debt repurchase
At the center of investor concerns is Strategy’s declining liquidity position. The company’s cash reserves have declined by 38% since the start of 2026, experiencing their steepest drop in May following the debt repurchase transaction.
The firm’s annualized dividend obligations have also risen sharply as it continued issuing preferred securities to finance additional Bitcoin purchases. According to CryptoQuant, annual dividend commitments have increased from roughly $300 million at the beginning of 2026 to approximately $1.2 billion.
“At current dividend obligations of $1.2 billion per year, restoring 24 months of coverage would require a cash reserve of approximately $2.8 billion, roughly twice what Strategy holds today,” the report stated.
While the strategy enabled continued Bitcoin accumulation, analysts warned that the growing dividend burden is becoming a structural risk.
“The market appears to be pricing this risk, the STRC price decline reflects not only near-term cash reserve weakness but also long-term concerns about the company’s ability to service its growing dividend burden,” CryptoQuant wrote.
Strategy is now sitting on an aggregate unrealized Bitcoin loss of approximately $10.6 billion. CryptoQuant noted that all Bitcoin acquired in 2024, 2025 and 2026 are currently underwater, with losses accelerating as the company continued buying through the early stages of the current bear market.
The analysts argued that selling Bitcoin to rebuild cash reserves would likely destroy shareholder value by crystallizing those losses.
MSTR’s decline mirrors that of Bitcoin, which briefly dipped below $60,000 before recovering slightly. The top crypto is down 2.4% over the past 24 hours at the time of writing.