Strategy situation ‘out of hand,’ says Arca exec on $15B preferred stock burden
Strategy’s capital structure may be under pressure as Arca’s Jeff Dorman highlights $15 billion in preferred stock obligations and CEO comments on possible Bitcoin sales.
Strategy is facing renewed scrutiny over its preferred stock financing model as investors question whether dividend obligations could eventually pressure the company to sell some of its Bitcoin.
The Strategy situation has “gotten out of hand,” Arca chief investment officer Jeff Dorman said in an X post on Thursday, referring to its roughly $15 billion in preferred stocks carrying around $1.5 billion in annual dividend obligations.
Dorman warned that the structure may become increasingly difficult to manage if market conditions remain volatile, with Bitcoin (BTC) trading about 16% lower year-to-date at roughly $73,737 at the time of writing.