Strategy Warns of Cash Depletion by March 2028

Strategy has warned that it may face a cash depletion crisis by March 2028. The burden of preferred stock dividends and the timing of convertible bond redemption claims may overlap, leading to a rapid depletion of cash reserves. As of October 25, Strategy's dollar liquid assets amount to approximately $5.07 billion, of which $4.83 billion is reserved for dividend and debt interest payments. In September 2027, an early redemption right for convertible bonds worth approximately $1.01 billion will arise, and in March 2028, an additional redemption right of $2 billion will open. If investors demand cash redemption, a total of $3.01 billion will be needed, and with the burden of dividends and interest, the current liquid assets could be exhausted. Strategy holds 850,000 bitcoins and has the potential to secure additional liquidity through stock issuance or bitcoin sales. However, if the price of bitcoin continues to decline and stock prices remain weak, existing shareholders may face increased dilution of their stakes.

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