At the end of May, a transaction caught the crypto market by surprise: Michael Saylor’s company, MicroStrategy, executed its first Bitcoin sale after a long period of exclusively buying. This sale was small compared to the company's total BTC holdings—totaling 32 BTC, whereas the company holds around 843,000 Bitcoins.
Since the company holds approximately 4% of the total Bitcoin supply ever issued, the market closely monitors any move made by the firm or its founder, Michael Saylor. Furthermore, it was widely known that the company aimed to accumulate increasing amounts of BTC through leverage—issuing new shares and debt securities—and because the market supported this thesis, it secured low interest rates on those securities. Given this context of accumulation, the decision to actually sell caught everyone in the market off guard!
Even though the sale was small, its impact was significant. Many likely wondered: if even Saylor—who had claimed he would never sell a single Bitcoin—went back on his word, what could happen to the market? The company's first sale signaled a clear break in the established pattern. It suggested that the holder of 4% of the supply could sell at any moment moving forward; this triggered a sharp decline and was one of the reasons the cryptocurrency has fallen so much since then.
Following the event, Michael Saylor issued the following statement: "I told you never to sell your Bitcoin. I never said the company wouldn't sell its Bitcoins." Faced with the adversity of needing liquidity, Saylor didn't think twice and sold the Bitcoin. Many did not accept this contradictory stance from Saylor, but the signal had already been sent: if necessary, sales will be made...
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Strategy Sold 3,588 BTC – Why It Matters
Some time after the market commotion caused by the sale of 32 Bitcoins, Strategy—having first primed the market—proceeded to sell another 3,588 Bitcoin. If there were any lingering doubts before, this sale demonstrated that liquidity is a priority for the company.
To raise the cash needed to pay dividends on the securities issued by the company, the decision was once again to sell its Bitcoin holdings—at a time when the BTC price is hovering around $60,000.
The issue revealed here is that, based on Strategy's actions, it is highly likely they will sell more Bitcoin in the future to cover dividends and bolster their dollar cash reserves. However, it is worth noting that Strategy's average purchase price for Bitcoin is over $75,000—representing a gap of more than $10,000 compared to the current value.
With this constant, "probable" selling pressure on the market, uncertainty and risk will once again factor into investors' calculations, potentially weighing down the price of BTC for an extended period. For Strategy, the obligation to pay dividends will force them to sell the asset even at a loss, as they need to generate the necessary cash.
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However, it is worth noting that Bitcoin's current price—hovering around $60,000—is not driven by a single factor. There is the issue of wars, which trigger a scramble for immediate liquidity; since crypto is an asset that trades 24/7, it often takes the first hit. Advances in quantum computing continue to raise questions regarding the security of cryptography. Finally, AI has been drawing a significant share of investment away from other sectors, such as crypto.
