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Analyst warns Strategy’s Saylor may be muddying Bitcoin signals
Standard Chartered said clearer messaging about using Bitcoin for dividends is needed after Strategy reported selling $216 million of BTC and outlining a capital framework for future sales.
Standard Chartered flagged communication challenges around Strategy founder Michael Saylor’s latest Bitcoin messaging, saying the signals could be “muddying the waters” for Bitcoin in the near term, according to Cointelegraph. The firm pointed to Saylor’s social media post that accompanied a chart and comes amid recent shifts in Strategy’s approach to its Bitcoin holdings.
In recent weeks, Strategy has moved away from a longstanding “never sell Bitcoin” stance, describing willingness to sell Bitcoin as needed to fund dividends for holders of its STRC preferred stock and to replenish its cash reserves, Cointelegraph reported. Earlier this month, the company sold $216 million worth of Bitcoin, reducing its total holdings to 843,775 tokens, based on a July 6 filing with the US Securities and Exchange Commission.
Days before that, Strategy unveiled a capital framework that allows Bitcoin sales to fund dividends and increased the annual dividend rate on its STRC preferred stock to 12%. The company also disclosed its US dollar reserve had grown to $2.55 billion.
Standard Chartered’s analyst, Kendrick, argued that effective communication of Strategy’s new strategy of using Bitcoin to back STRC could reassure markets that wholesale selling is unlikely, which he said may support Bitcoin prices. Kendrick added that if the signaling works, it could reduce pressure for Strategy to sell any additional Bitcoin by supporting the STRC price, Cointelegraph reported.
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