Strategy (formerly MicroStrategy) founder and Executive Chairman Michael Saylor disclosed on July 7 via X platform the Bitcoin break-even annual recurring revenue (ARR) metric: Bitcoin only needs to grow 3.3% annually for capital gains to indefinitely fund STRC preferred stock dividends; Saylor calls this one of Strategy's "most misunderstood metrics."
Saylor: BTC Growing 3.3% Annually Can Indefinitely Fund STRC Preferred Dividends
According to Saylor's public post on X, Strategy's BTC Break-even ARR is calculated by dividing the company's annual preferred stock dividend obligation (currently about $1.76 billion) by the market value of the company's Bitcoin reserves, yielding a 3.3% break-even ARR.
Saylor stated: "If BTC rises more than 3.3%, BTC capital gains can fund STRC dividends indefinitely."
An accompanying chart released by Strategy shows: under zero Bitcoin growth, reserves plus a $2.55 billion cash buffer can cover payments for about 31 years; the cash buffer alone can sustain approximately 17 months.
Strategy Holds 843,775 BTC, Worth Approximately $53.8 Billion
According to Strategy's financial report, the company currently holds 843,775 Bitcoin, valued at about $63,603 per coin, totaling approximately $53.8 billion; compared to 818,334 BTC disclosed in the May earnings report, it added over 25,000 coins during the Bitcoin downturn.
Q1 2026 preferred stock dividends were $229.5 million, up more than 20 times from $10.6 million in Q1 2025; since the beginning of 2025, the company has paid preferred stock dividends 23 consecutive times, totaling over $693 million; outstanding preferred stock equity currently exceeds $13.5 billion.
STRC Annualized Yield 11.5%, But Trades Below $100 Par Target
According to reports, STRC preferred stock had an annualized yield of 11.5% in May, but still trades below the $100 par target, reflecting that preferred stockholders have priced in risk. Critics point out that the break-even model assumes debt will no longer compound, but so far the annual preferred stock dividend obligation continues to grow.
JPMorgan Warns of Up to $1.25 Billion Selling Pressure; July 1 Sales Were Seven Times Forecast
According to reports, JPMorgan recently warned that Strategy's Bitcoin sale policy could bring up to $1.25 billion in selling pressure; on-chain data shows 491 BTC were sold on July 1, with later data indicating actual sales were about seven times the initial forecast.
Additionally, Bitcoin is currently down about 49% from its October 2025 peak. Whether the 3.3% break-even ARR is low enough depends on Bitcoin regaining a long-term growth trend.
Frequently Asked Questions
What is Strategy's BTC Break-even ARR and how is it calculated?
According to Saylor's X post, the BTC Break-even ARR is calculated by dividing the company's annual preferred stock dividend obligation (currently about $1.76 billion) by the Bitcoin reserve market value, resulting in 3.3%; this means Bitcoin only needs to grow 3.3% annually for capital gains to indefinitely fund STRC preferred stock dividends.
How much Bitcoin does Strategy currently hold and what is the cash buffer?
According to Strategy's financial report, the company currently holds 843,775 Bitcoin, worth about $53.8 billion; the cash buffer is $2.55 billion, which under zero Bitcoin growth can independently cover about 17 months of dividends, and together with reserves can cover about 31 years.
How has Q1 2026 preferred stock dividends changed compared to the same period last year?
According to Strategy's Q1 2026 financial report, Q1 2026 preferred stock dividends reached $229.5 million, up more than 20 times from $10.6 million in Q1 2025; since the beginning of 2025, dividends have been paid 23 consecutive times, totaling over $693 million.
