The bank warns Strategy’s Bitcoin sales may continue to cover $1.7 billion in annual preferred stock dividends amid limited reserves.
JPMorgan raised concerns after Strategy sold 32 BTC, questioning whether further Bitcoin sales will fund preferred stock dividends. The bank noted Strategy’s dollar reserves cover only 6.3 months of payments, prompting a shift to a cautious outlook on digital assets.
The bank’s revised stance follows projections that Strategy must fund roughly $1.7 billion in annual dividends. Passage of the CLARITY Act, seen as unlikely this year, could influence the second-half market outlook, JPMorgan added.