Investment firms Benchmark and TD Cowen have dismissed the possibility that Strategy (formerly MicroStrategy) could be pushed into a forced Bitcoin sell-off, reaffirming their buy ratings on the stock. The stock rose more than 8% on Monday after the company disclosed it had purchased an additional 1,587 BTC for about $100 million between June 8 and June 14.
Why the ‘death spiral’ narrative is overblown
Benchmark analyst Mark Palmer directly challenged the death spiral hypothesis, which suggests a sharp Bitcoin dip could force Strategy to liquidate holdings, triggering a cascade. Palmer stressed that before any meaningful BTC sale, the company would first exhaust its $1 billion cash reserve set aside for dividend payments. He noted that the firm’s perpetual preferred securities create no fixed maturity or single-liquidation trigger. “Numerous steps would have to be taken before any BTC is sold, making the scenario highly improbable,” Palmer wrote. TD Cowen echoed that view, calling the dividend obligations “sufficiently manageable” given the company’s cash position.
Continued accumulation and treasury details
Strategy’s latest acquisition, funded entirely through common stock sales, brought its total holdings to 846,842 BTC, purchased at an aggregate cost of approximately $64.1 billion including fees. The company controls more than 4% of Bitcoin’s maximum supply. The dollar reserve stood at $1.1 billion as of June 14, up from $1 billion a week earlier, and about $25.7 billion remains available under its common-stock issuance program. The pace of purchases has slowed from earlier in the year, partly because the STRC preferred stock has traded below its $100 par value, limiting that funding avenue. However, the firm retains ample financial flexibility.
Market reaction and broader context
The rebuttal of death spiral fears and the fresh Bitcoin buy sent MSTR shares higher. The company’s recent small sale of 32 BTC to help fund preferred-share distributions had stoked those fears, but analysts argued the sale was immaterial and part of routine treasury management. Benchmark and TD Cowen both emphasized that the company’s structure is designed for long-term holding, with no near-term pressure to sell its Bitcoin.
For the crypto market, the firm’s continued buying and the analyst defense temper concerns that a major corporate holder could become a forced seller. The analysis underscores that sensational headlines can often obscure sound financial fundamentals.
