JPMorgan downplays risk from Strategy’s Bitcoin sales

Strategy ↗ 0.02%, the enterprise software company turned digital asset treasury, sold 3,588 Bitcoin for approximately $216 million between June 29 and July 5, marking its largest cryptocurrency disposal in six years of accumulating the asset. The sale, disclosed in a Form 8-K filing on Monday, July 6, was used to fund dividend payments on the company's Digital Credit preferred securities.wsj+2

A Shift in the Saylor Playbook

The transaction represents a departure from co-founder Michael Saylor's long-held "never sell your Bitcoin" philosophy. Following the sale, Strategy said it retains 843,775 Bitcoin and roughly $2.55 billion in U.S. dollar reserves. The company had previously sold just 32 Bitcoin in early June — its first sale since 2022.nypost+4

Bloomberg reported that the sale is only Strategy's third Bitcoin disposal since it began building holdings in 2020. The company executed the sale in two tranches: 1,363 Bitcoin for $80.8 million and another 2,225 Bitcoin for $135.2 million, at an average price of approximately $60,200.info.arkm+2

Analysts Call the Sale Constructive

Grayscale Research argued the sale reduced financing risk and strengthened Strategy's balance sheet, noting the $2.55 billion cash reserve now covers roughly 17 months of preferred dividend payments. The firm said the move removes "a key overhang that had weighed on investor sentiment" and could support a more durable Bitcoin price floor.crypto+2

JPMorgan ↗ 1.47% said in a note to investors on Thursday that Strategy's Bitcoin sales are not the largest long-term risk facing Bitcoin, though the bank had previously warned that the company's new sales policy introduced "avoidable two-way risk" into crypto markets. BitGo CEO Mike Belshe said single-digit percentages of Bitcoin's total supply are "probably right" for large holders like Strategy, which currently holds roughly 4% of the 21 million supply cap.bloomberg+3

Market Context

The sale arrived during a prolonged downturn for Bitcoin, which has traded below key technical levels for five consecutive months. Bitcoin bounced above $63,000 following the disclosure, aided by fresh inflows into BlackRock's ↗ 2.96% spot Bitcoin ETF, though broader market headwinds — including geopolitical tensions and weakening institutional flows — continue to weigh on the asset.theblock+1