JPMorgan Warns Strategy's Bitcoin Sales Policy Creates 'Two-Way Risk'

According to JPMorgan, Strategy recently modified its capital structure to permit Bitcoin sales for dividend payments and stock repurchases, introducing what the banking giant calls a 'two-way risk.' Previously, Strategy operated primarily as a Bitcoin buyer, continuously acquiring the asset through capital raises. Under the new framework, the company can now switch between buying and selling based on cash needs.

JPMorgan's research team argued that Strategy's current cash reserves of $2.55 billion—covering approximately 17 months of preferred dividends and interest costs—are insufficient. The bank recommended a coverage period of 24-36 months to make investors confident the company would not need to sell Bitcoin in the foreseeable future. While Strategy holds a substantial 847,363 BTC, the shift introduces uncertainty about its future role in the market.