Cost of stacking sats rises as MicroStrategy cash tightens

CryptoQuant urged MicroStrategy to halt new Bitcoin purchases and rebuild cash reserves after calculating that the company’s dividend coverage had declined to about 14 months from roughly seven years. The analytics firm flagged a sharp rise in recurring payout obligations and a reduced cash buffer.

CryptoQuant’s CEO Ki Young Ju said annual dividend obligations climbed to about $1.2 billion after large issuances of STRC preferred shares that carry an 11.5% yield. The company’s reported cash balance recovered to roughly $1.4 billion following recent MicroStrategy share sales, but remains down about 38% year-to-date after the firm repurchased $1.5 billion of its 2029 senior notes.

Dividend coverage, measured in months, shows how long on-hand cash can cover scheduled dividend payments. A drop from approximately seven years of coverage to about 14 months reflects a much higher recurring payout burden relative to available cash.

STRC preferred shares have traded as much as 17.5% below their $100 par value, which limits MicroStrategy’s ability to raise fresh capital by issuing similar preferred stock. Lower preferred-share prices make additional issuances more dilutive or more costly to investors, and an 11.5% coupon increases the cash required to service those obligations.

CryptoQuant did not indicate that MicroStrategy faces an immediate liquidity shortfall. The firm recommended pausing new Bitcoin accumulation until cash coverage improves. “MicroStrategy should halt new Bitcoin buys and rebuild liquidity until coverage improves,” Ki Young Ju warned.

MicroStrategy has been funding some Bitcoin purchases through sales of its own shares and by issuing high-yield preferred stock. CryptoQuant said both channels have shown limits in recent months as market pricing and high yields have reduced the attractiveness or feasibility of continued issuance.

Separately, the Chicago Board Options Exchange is considering converting its long-dated continuous Bitcoin and Ether futures into perpetual futures contracts, following regulatory guidance that allowed perpetuals on registered exchanges. Perpetual futures have no expiration date, letting traders hold leveraged positions without rolling contracts, and volumes for perpetuals have risen across centralized and decentralized markets.

Chainlink joined a working group with European and South Korean banking groups, called Project Pangea, to study whether regulated euro and won stablecoins could enable real-time foreign-exchange settlement using tokenized currencies and atomic swaps. The group will evaluate potential effects on wholesale FX markets and is not planning to launch a live payment network as part of the study.

Zcash miner Fortitude Mining Holdings announced an all-stock merger with medical technology company HeartSciences that would take Fortitude public on Nasdaq under the Fortitude name and ticker TUDE, pending regulatory approval. HeartSciences reported an $8.77 million net loss in fiscal 2025; the merger announcement drove a sharp rise in HeartSciences’ share price.

CryptoQuant issued its warning this week. The firm’s figures and the other developments described above provide details on recent shifts in how crypto-focused companies are financing operations, managing derivatives products and exploring tokenized settlement options.