American business intelligence and software company Strategy Inc remains one of the biggest subjects of analysis regarding its Bitcoin holdings. The falling prices of Bitcoin have placed the company underwater in its reserve holdings, as its $BTC purchase amount is at least 10% above the current value of the coin.
Strategy and Bitcoin bet no cause for concern yet
Earlier, Strategy had confirmed that it could withstand an extended price drawdown for Bitcoin, allaying fears of any insolvency. In a new analysis, Arkham corroborated this take, exploring some of the company’s debt profile overall.
Arkham pointed out Strategy’s preferred stock and convertible notes, two of the company’s obligations for raising cash. While the preferred stock is subject to dividend payments and redemptions, convertible notes come with coupons.
Notably, Saylor selling common stock to fund Bitcoin purchases does not create a future cash obligation for Strategy. Therefore, ‘Saylor’s average price’ is somewhat irrelevant to the question of whether Saylor needs to sell Bitcoin.
Saylor can remain underwater for as long as…
— Arkham (@arkham) February 20, 2026
With these coupons, Strategy is obligated to pay back or convert the notes into stock at maturity. As of now, the Bitcoin-based firm currently owes $8,000,000,000 across all of its convertible notes. As unveiled, the company holds $2.5 billion worth of cash.
As an insight into the options the company has, the research firm noted potential conversion of the convertible notes to MSTR stock. Besides this, the Michael Saylor-led firm can refinance its debts. As Arkham noted, the option to sell its Bitcoin holdings will only come into the conversation if Strategy is unable to raise additional funds.
More $BTC purchases ahead
From Peter Schiff to other gold bugs, Strategy has always been criticized for its Bitcoin bets. However, Michael Saylor has reiterated the commitment to the asset with no plans to sell $BTC. This comes amid sustained $BTC purchases announced on almost a weekly basis.
According to Arkham, Saylor remains the primary key to the company offloading its Bitcoin bag. For now, it noted that selling common stock to fund $BTC purchases does not create a future cash obligation for Strategy.
With this reality, the average price is not considered relevant to whether Saylor or the company has to sell its Bitcoin. With its adopted financing model, the company can choose to remain underwater for as long as convertible note obligations are met.
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