Strategy has skipped four straight weekly Bitcoin (BTC) purchases, its longest buying pause in two years. The company reports second-quarter earnings Thursday, July 30, after the US market closes.

SEC filings confirm Strategy’s last purchase covered the week ending June 21. Since then, the company has sold Bitcoin instead of adding to its stack — a notable reversal for a firm that built its identity on accumulating BTC quarter after quarter.

A Pause Built on Falling mNAV

Strategy’s stock traded at a premium to its Bitcoin holdings for years, a ratio called mNAV. In simple terms, mNAV compares the company’s market value to the net value of the Bitcoin it holds. A reading above 1 means investors are paying more for the shares than the underlying coins are worth, and that premium let the company sell shares above BTC value and grow Bitcoin per share for holders.

The model breaks once mNAV drops toward 1. New share sales then destroy value instead of creating it, because each new share dilutes existing holders rather than adding Bitcoin per share. mNAV touched roughly 0.99 in late June, its first sub-parity reading ever, before recovering to about 1.03. Strategy’s holdings now trade underwater against their purchase price, and management puts the real breakeven closer to 1.22 — a level that leaves little room for aggressive new issuance.

Strategy sold 3,588 BTC in two tranches between June 29 and July 5 for about 6 million. The sales funded preferred stock dividends and topped up its cash reserve. Strategy adopted this capital framework in late June, and the reserve reached .225 billion by July 20. The shift signals a more defensive posture, prioritizing liquidity and dividend obligations over further Bitcoin accumulation while market conditions stay unfavorable.

What Thursday Could Show

Strategy posted a .5 billion operating loss in the first quarter on Bitcoin’s mark-to-market decline. LSEG’s consensus estimate points to a swing back to .86 billion in Q2 operating income, but two of the seven analysts behind that number submitted forecasts before June’s bitcoin slide, which adds uncertainty to the headline figure.

Because Strategy now marks its Bitcoin at fair value, its reported earnings can swing sharply with the price of BTC, making the treasury the single biggest driver of each quarter’s result. Thursday’s report will show whether Strategy sticks with this trade-off, raising fresh capital while leaving its Bitcoin holdings untouched, and whether management signals a return to buying once the premium widens again.

Source: BeInCrypto