Bitcoin (BTC 0.87%) holders might have a problem on their hands. During the Bitcoin treasury company Strategy‘s (MSTR 3.78%) first-quarter 2026 earnings call, Executive Chairman Michael Saylor told investors that he would “probably sell some Bitcoin to fund a dividend, just to inoculate the market.” This is the same person who spent the last several years insisting that nobody should ever sell their Bitcoin, and that his company would never do so either.
Bitcoin’s price slipped a little bit on the news before recovering. But worries of an imminent collapse driven by Strategy selling all of its holdings are missing the forest for the trees. What’s likely to happen here is something that was pretty much inevitable — so does it mean you should sell your Bitcoin?
Image source: Getty Images.
Why selling was always going to happen eventually
To appreciate the financial bind that Strategy is in — which is what will likely necessitate its future sales of some of its Bitcoin — it’s necessary to understand how the company aims to reward its shareholders.
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Current Price
$179.75
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Market Cap
$62B
Day’s Range
$175.72 – $184.75
52wk Range
$104.17 – $457.22
Volume
839
Avg Vol
20M
Gross Margin
73.37%
Strategy’s Stretch (STRC 0.01%) preferred stock is a perpetual preferred share paying an 11.5% annual cash dividend, which currently means paying out roughly $1.2 billion in total obligations per year. That cash has to come from somewhere, and Strategy’s legacy business, software, generates only about $124 million in annual revenue.
Here’s where it gets interesting. Strategy designed the Stretch shares such that 100% of its dividends are classified as return of capital (ROC) for U.S. federal tax purposes, meaning that investors owe no income tax on those payments for about 10 years or more. For that treatment to hold up, legally speaking, the company cannot generate earnings or profits that would reclassify its distributions as ordinary dividends. So the money for Stretch payouts was always going to come from issuing new debt or new equity — or from selling Bitcoin.
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$99.96
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$99.92 – $99.98
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Saylor’s language about “inoculating” the market is a calculated maneuver to keep Bitcoin’s price climbing. He wants to establish a precedent that Strategy can sell small amounts of Bitcoin without triggering a panic. If the market absorbs a modest sale and Bitcoin’s price holds, it defuses a fear that has hung over both the stock and Bitcoin for months now. That way, in the future, Saylor could ostensibly be doing Bitcoin sales to fund Stretch’s dividend, while also making Bitcoin purchases using new equity or debt issuance. The value of the company’s shares would increase as Bitcoin’s price rises, thanks to its huge hoard.
The quantities being sold would almost certainly be small or perhaps even negligible relative to Strategy’s stack. It holds 818,334 bitcoins, or about 3.9% of all the coins that will ever exist. A 1% trim of roughly 8,200 coins, worth about $660 million as of May 7, would cover more than two quarters of Stretch dividends while barely denting the position. Strategy also maintains a $2.2 billion cash reserve covering about 2.5 years of its obligations, and it purchased an impressive 103,690 bitcoins in the 90 days before the earnings call.
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(-0.87%) $-703.81
Current Price
$80125.00
Key Data Points
Market Cap
$1.6T
Day’s Range
$79287.00 – $81158.00
52wk Range
$60255.56 – $126079.89
Volume
38B
Concentration risk could rise even more from here
From the perspective of holders, Strategy controls a historically unprecedented share of the supposedly decentralized asset, and aspires to own even more of it. Strategy’s decisions, particularly whether to buy, hold, or sell the asset, ripple outward into Bitcoin’s price. If the company blows up somehow and is forced to liquidate its holdings, investors are going to be in for a world of pain.
Another now-emerging risk worth monitoring is that this asset’s narrative becomes much less compelling. Strategy was the loudest champion of unconditional accumulation of Bitcoin, and dozens of smaller digital asset treasury (DAT) companies built their own crypto portfolios by copying its playbook. If Strategy normalizes selling, those imitators might no longer fear the stigma of selling.
Nonetheless, that doesn’t mean the investment case for Bitcoin has weakened. The 2028 halving is on the horizon, its institutional adoption is broadening rapidly, and its scarcity is increasing with each passing year. One company adjusting its treasury posture doesn’t unwind any of that.
So you shouldn’t sell your Bitcoin. Keep accumulating it, and be ready to hold it for a long time.