CryptoQuant Says Strategy Builds $1.44B Safety Net Against Likely Bitcoin Bear Market

Michael Saylor’s Bitcoin-focused firm, Strategy, has created a major U.S. dollar reserve amid weakening market sentiment.

The company set aside $1.44 billion to cover dividend and debt obligations, marking a notable shift toward stronger liquidity amid rising Bitcoin volatility.

Strategy Establishes Major USD Buffer

The reserve, funded through Strategy’s recent MSTR at-the-market share issuance, is designed to provide stability during uncertain conditions. It currently covers at least a year of dividend payments. Moreover, the company plans to expand it further, aiming for a buffer that protects up to 24 months of future commitments.

In a Wednesday report, on-chain analytics firm CryptoQuant interpreted the move as a signal that Strategy expects challenging market conditions ahead. The firm said the targeted 24-month reserve suggests expectations of limited price strength or even downward pressure on Bitcoin over an extended period.

CryptoQuant also noted that capital markets may be less supportive of new equity issuance, which Strategy relied on heavily in past cycles. This shift, the firm said, reflects a more conservative posture as the company prepares for potential turbulence.

Transition Toward a Dual-Reserve Strategy

With the new USD buffer, Strategy now operates with both cash and Bitcoin reserves. CryptoQuant emphasized that this approach lowers the risk of forced Bitcoin sales during steep market declines.

The firm characterized this as a significant departure from Strategy’s earlier playbook, which relied on equity and convertible debt to purchase more Bitcoin from 2020 through late 2025. Therefore, the updated strategy indicates that the firm is emphasizing stability over rapid growth.

Implications for Bitcoin Market Demand

The slowdown in Bitcoin accumulation has broader market implications. Specifically, CryptoQuant said reduced Bitcoin purchases may weaken a demand channel that helped drive earlier bull markets.

However, the larger cash reserve and new hedging tools also lower the risk of forced liquidation, which could help maintain long-term market stability.

According to CryptoQuant, Strategy now accepts that protecting its Bitcoin stack requires flexibility. This includes maintaining cash buffers, employing derivatives as necessary, and considering selective sales only in severe stress scenarios.

Strategy’s Bitcoin Buying Declines Sharply in 2025

This strategic shift is reflected in Strategy’s recent purchase activity. CryptoQuant reported that monthly buying plunged from 134,000 BTC in November 2024 to 9,100 BTC in November 2025. 

Moreover, the firm has added only 135 BTC so far in December, signaling a significant retreat from its previous pace. This period of deceleration aligns with the year’s most pronounced decrease in Bitcoin’s value.

For context, Bitcoin registered a new all-time high of $126,080 on October 6. Since then, the world’s largest cryptocurrency has erased over 25% of its value. As of press time, Bitcoin is trading at $93,051, down 17% over the past three months, according to CoinGecko.

Bearish Indicators Strengthen Across the Market

CryptoQuant noted that several major on-chain and technical signals now signal the onset of a bearish phase. For instance, its Bull Score Index has now dropped to zero, a threshold last recorded in early 2022, underscoring the intensity of the current downturn.

Julio Moreno, the firm’s head of research, forecasts Bitcoin may trade between $70,000 and $55,000 next year if bearish conditions persist. He added that Strategy’s new reserve slightly increases the probability of Bitcoin sales, though it remains a last resort. In his view, derivatives would be tapped first to protect the company’s holdings.

Mizuho Maintains Positive Outlook for MSTR

Despite market weakness, Mizuho Securities reaffirmed its ‘Outperform’ rating on Strategy stock (MSTR) and maintained its $484 price target. The bank issued its view following the announcement of the Strategy’s reserve and after hosting an investor Q&A with CFO Andrew Kang.

Kang told Mizuho that the USD reserve is strictly a liquidity tool and not a signal of imminent Bitcoin sales. He noted that Strategy will expand the buffer when its multiple-to-net-asset value (mNAV) exceeds 1, thereby allowing the company to capitalize on favorable conditions.

He also said that the Strategy can sustain operations for more than three years at the current Bitcoin price of around $93,000.

Furthermore, Mizuho added that Bitcoin sales would occur only if the company’s valuation remains depressed for a long period. Overall, the reserve gives Strategy room to navigate an extended downturn without pressure to liquidate assets.