Key Takeaways:
- Strategy holds 843,706 BTC with roughly $11 billion in unrealized losses.
- Grayscale warns the leveraged model may force further Bitcoin sales.
- MSTR stock fell 28% this week as STRC preferred shares trade below par.
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Strategy faces $11B unrealized loss as Grayscale warns of forced BTC sales
Bitcoin fell 16% to $59,000 after Strategy sold 32 BTC, as Grayscale warned the company's leveraged accumulation model faces mounting financial strain.
"Strategy's levered business model is under pressure, and this has increased the volatility for the BTC market as a whole," Zach Pandl, head of research at Grayscale, said.
Strategy holds 843,706 Bitcoin worth about $51.3 billion at current prices, acquired at an average cost of $75,599 per coin — leaving the company with roughly $11 billion in unrealized losses. Its preferred stock STRC, designed to trade at $100 with an 11.5 percent dividend, has fallen to about $95, implying investors require a higher yield. If Strategy raises the dividend to restore STRC to par, it would increase cash obligations and potentially force additional Bitcoin sales, creating a negative feedback loop, Grayscale said.
The pressure on Strategy's model has broader implications for the $1.1 trillion crypto market. With 843,706 BTC — roughly 4 percent of the total supply — concentrated on one leveraged balance sheet, any forced liquidation could amplify downward price pressure. "For the health of the Bitcoin ecosystem over the long run, less BTC on levered balance sheets and more on diversified corporate balance sheets will be a positive," Pandl said.
Augustine Fan, partner at crypto software firm SignalPlus, said the market downturn reflects more than just Strategy's actions. "The reality is that even the most ardent supporters are running out of reason to be structurally bullish," Fan told Cointelegraph.
Jeff Ko, chief analyst at CoinEx, described Strategy's first Bitcoin sale as an "important psychological trigger" for this week's selloff, though he noted the move gives the company greater flexibility. "Greater flexibility around selling Bitcoin can help Strategy manage balance sheet risk more prudently, rather than forcing itself into a one-way accumulation strategy under all market conditions," Ko said.
The broader corporate Bitcoin treasury sector has lost $62 billion in combined market capitalization during the June 2026 rout, according to data from Lookonchain. Across the eight largest pure-play Bitcoin treasury firms, controlling more than 850,000 BTC combined, unrealized losses had surpassed $10 billion before the latest leg down. Investor Michael Burry has described the dynamic as a "reflexive unwind," where falling BTC prices compress equity premiums, close the issuance window, and convert the model from accumulate-forever to sell-to-survive.
MSTR shares fell 28 percent this week to $126, a two-month low, while Bitcoin traded at $59,000 as of 15:00 EST on June 5. The next key support level for BTC sits at $55,000, with resistance at $65,000, according to CoinGecko data.
This article is for informational purposes only and does not constitute investment advice.
[1] Strategy faces stress test as Grayscale warns leveraged Bitcoin model may force further sales[2] Grayscale Warns Strategy’s Leveraged Bitcoin Model Is Under Pressure, Risking Further Price Declines[3] Strategy’s Bitcoin Model Under Pressure, Grayscale Warns[4] The Bitcoin Crash Just Wiped $62 Billion From Corporate Treasury Holders, Is the MicroStrategy Model Broken?[5] Why Strategy (Formerly MicroStrategy) Stock Collapsed This Week
