Strategy's annual debt obligations stand at approximately $1.76 billion, with its $66.7 billion Bitcoin holdings relying on capital market financing

Odaily News: Bitcoin treasury company Strategy's Bitcoin holdings are currently valued at $66.7 billion, with annual obligations such as preferred stock dividends and interest amounting to approximately $1.76 billion. According to Regime Intelligence analysis, the company's 840,447 BTC holdings correspond to roughly $22 billion in debt and priority claims, and continued access to capital market financing serves as the foundation for meeting its obligations.

Stress tests show that Bitcoin prices would need to fall by approximately 96% before Strategy's Bitcoin holdings and reserves would be insufficient to cover its convertible bonds; its debt is not a traditional Bitcoin-collateralized margin loan, and there is no BTC margin call mechanism triggered by price declines.

Report author Sherif Saad stated that Strategy needs to maintain its financing cycle to cover annual debt and preferred stock expenses, with cash reserves currently covering approximately 2.6 times the related annual expenses. If the financing environment deteriorates, the company may rely more heavily on reserves and Bitcoin sales to meet its obligations.

Strategy has sold Bitcoin four times since May, with the most recent sale involving 1,690 BTC, using the proceeds to pay preferred stock dividends, repurchase shares, and increase its dollar reserves. CEO Phong Le said earlier this month that the company has purchased approximately 25 times the amount of Bitcoin it has sold this year, and plans to resume purchases later this year. (Cointelegraph)