Strategy Inc. Authorizes $1.25 Billion Bitcoin Sales Under New Digital Credit Capital Framework

The framework comprises five elements: a USD reserve policy with a 12-month minimum floor, a 50 basis point increase to 12 percent on Variable Rate Series A Perpetual Stretch Preferred Stock effective July 2026, $1 billion buyback authorizations each for digital credit securities and common stock, and a bitcoin monetization program limited to reserve replenishment, dividend servicing when sales are cheaper than equity issuance, and buybacks. All uses outside the three enumerated purposes require fresh board approval. The combined reserve and monetization capacity equals 25.9 months of obligations.

Primary records show the company now treats bitcoin explicitly as capital rather than a passive holding, shifting from one-way issuance to active management of securities when they trade below accretive levels. This follows repeated convertible debt and preferred offerings that funded prior bitcoin accumulation, creating a closed loop where BTC can be monetized to service the resulting liabilities without immediate equity dilution.

The structure creates clear incentives: sales become probable when bitcoin volatility compresses spreads or when the reserve dips toward the 12-month threshold, while buybacks can absorb preferred supply and support the target $99-100 trading range for STRC. Market impact hinges on whether sales occur at scale during price weakness, amplifying downside pressure beyond what simple treasury accumulation produced.

Future execution will be visible in quarterly 10-Q cash flow statements and any 8-K disclosures of monetization above $100 million thresholds. Regulators and creditors will monitor adherence to the board-only override clause for non-enumerated uses.