Strategy Inc. (NASDAQ: MSTR) shares fell more than 10% on Tuesday to $ 92, a two-year low, as bitcoin cratered below $ 60,000 and note an analyst from CryptoQuant warned the company overextended itself and should stop buying bitcoin before its financial situation deteriorates further.
Bitcoin fell to around $59,000 on the day, down more than $6,700 or about 5%, its worst one-day loss in months. The selloff caused a drop in the rate of liquidation in crypto derivatives markets, with approximately $1.1 billion in active positions being forcibly closed within a 24-hour window. This move pushed bitcoin below the average cost base for all of Strategy’s purchases made in 2024, 2025, and 2026 – leaving the company sitting on an estimated loss of $10.6 billion.
The strategy fell by the wayside for bitcoin, as it always does. Shares opened near $103 and shed $10.97 from Monday’s close of $103.84 — the first time the stock has traded below $100 since March 2024.
CryptoQuant: Stop buying, rebuild money
The slide came on the same day that CryptoQuant published a note on A strategy to pause bitcoin hoarding and return its reserves before buying more. The company’s head of research, Julio Moreno, identified a set of numbers that tell the story of the company’s cash flow model under pressure.
Strategy’s annual dividend obligations — payments owed on a range of popular instruments including STRC, STRK, STRF, STRD, and STRE — have grown from about $300 million in early 2026 to about $1.2 billion now, a fourfold increase in less than six months.
Reserves are down 38% this year. The dividend payout, once over seven years, has been compressed to 14 months. CryptoQuant recommends that the company return approximately $2.8 billion in reserves before resuming bitcoin purchases.
Preferred stocks themselves flash a warning sign. STRC, the Strategy’s variable-rate preferred, was trading near $84, below its $100 target.
When the preferred shares trade below, the leverage mechanism that supports bitcoin purchases breaks down — the company cannot issue the preferreds on attractive terms if the underlying instruments are trading at a discount.
A self-reinforcing cycle of planning, in reverse
The strategic model is built on premium. When MSTR shares trade for more than the value of bitcoin on its balance sheet, the company can issue stock or preferred instruments, use the proceeds to buy bitcoin, and push the NAV per share higher — a cycle that rewards existing shareholders. The stock now trades at a discount to its bitcoin NAV, which is roughly 0.80x mNAV. That means that both main taps – the normal balance and the preferred release – are blocked at the same time.
The company owns 847,363 bitcoins, which has been acquired at an average price of about 75,680 per coin. With bitcoin at $59,324, that gap has grown to more than $16,000 per coin across the stack.
Peter Schiff, a long-time bitcoin critic who has been watching Strategy’s route, said on Tuesday that if MSTR’s shares continue to fall, Saylor may face pressure to sell bitcoin to meet obligations – a situation that will put additional downward pressure on the asset that supports the entire structure.
The scheme made its first bitcoin sale in almost four years at the beginning of June, uploading 32 BTC. The company included the sale as an indication that it could cover equity obligations through liquidation of assets. The market reaction today suggests that investors remain uncertain.
Whether Saylor pauses the purchase, as CryptoQuant recommends, or finds another way forward, the main question now is whether the model built for premium prosperity and the rising value of bitcoin can hold together in an environment where both have retreated.
At the time of writing, Bitcoin is trading at $59,300, while Strategy shares are close to $92.
