JPMorgan warns Strategy's new Bitcoin sale plan could add unnecessary market risk

JPMorgan analysts say Michael Saylor's company, Strategy, has formally rolled out a policy that allows it to sell Bitcoin, shifting its profile from a pure BTC accumulator to a potential seller and creating what the bank calls an "avoidable two-way risk" for the crypto market. The framework, branded the BTC Monetization Program, authorizes Strategy to sell Bitcoin to raise up to $1.25 billion in cash. The proceeds would be used to fund preferred stock dividends and interest costs, or to repurchase preferred or common shares as part of capital-structure optimization. JPMorgan said any future BTC sales by Strategy could increase uncertainty and amplify volatility in Bitcoin prices. The analysts added that the risk could have been mitigated if the company had chosen to build dividend reserves through equity issuance instead. Strategy currently targets a minimum cash buffer sufficient to cover 12 months of preferred dividends and interest expenses. Its existing $2.55 billion cash reserve covers roughly 17 months. JPMorgan argues the company should lift that buffer to cover 24 to 36 months of obligations, even if it results in the common stock trading at a discount to net asset value, because a larger reserve would help reassure investors that Strategy is unlikely to be forced into selling Bitcoin in the near term.