Strategy approves Bitcoin monetization program under new capital framework

Strategy has approved a board-authorized Bitcoin monetization program as part of a new capital management framework. It marks the first time the company has formally outlined how it could sell portions of its Bitcoin holdings to support shareholder returns and strengthen its balance sheet.

The Digital Credit Capital Framework allows Strategy to monetize Bitcoin to build U.S. dollar reserves. Also, to fund preferred dividend payments and interest obligations, and repurchase preferred securities and MSTR shares. 

The company said the framework is designed to enhance financial flexibility while reaffirming Bitcoin as its primary treasury reserve asset.

Strategy formalizes when Bitcoin can be monetized

The board approved a Bitcoin Monetization Program authorizing management to sell Bitcoin under defined circumstances rather than requiring separate approval for each transaction.

Under the framework, Strategy may monetize Bitcoin to increase its U.S. dollar reserve by up to $1.25 billion. Also, to maintain liquidity for preferred dividend and interest payments and fund authorized repurchases of preferred securities and common stock. 

Any Bitcoin sales outside these defined purposes would require additional board approval.

Executive Chairman Michael Saylor described the move as an evolution of the company’s capital strategy.

“Bitcoin is capital,” Saylor said. “Our Digital Credit Capital Framework lets us transform that capital into productive support for shareholder value while preserving our long-term Bitcoin strategy.”

Company shifts toward active capital management

President and CEO Phong Le said Strategy is evolving beyond raising capital solely to acquire Bitcoin toward actively managing its capital structure.

Alongside the new framework, the company disclosed a $2.55 billion U.S. dollar reserve, which currently covers approximately 17.4 months of preferred dividend and interest obligations. Including the authorized Bitcoin monetization capacity, Strategy estimates coverage would increase to approximately 25.9 months.

The board also authorized up to $1 billion of preferred security repurchases and $1 billion of MSTR share buybacks. This gives management additional flexibility to allocate capital depending on market conditions.

Bitcoin holdings remain unchanged

The announcement accompanied Strategy’s latest Bitcoin holdings update, which showed the company made no Bitcoin purchases during the reporting period.

Strategy continues to hold 847,363 BTC, acquired for approximately $64.5 billion at an average purchase price of $75,651 per Bitcoin. At current market prices, the holdings remain among the largest corporate Bitcoin treasuries globally.

Final Summary

• Strategy approved a board-authorized Bitcoin monetization program that allows BTC sales to fund reserves, dividends, and buybacks under a new Digital Credit Capital Framework.
• The company also disclosed a $2.55 billion cash reserve, authorized $2 billion in buybacks, and reported unchanged holdings of 847,363 BTC.