Strategy, formerly MicroStrategy, holds 843,738 Bitcoin as of May 25, 2026, making it the largest corporate Bitcoin holder with approximately 4 percent of all Bitcoin that will ever exist. The company carries $6.7 billion in convertible notes and $15.5 billion in preferred stock, creating fixed obligations that depend on Bitcoin price stability. A Polymarket prediction contract prices the probability of a Strategy margin call in 2026 at roughly 8.5 percent, reflecting institutional assessment of tail risk. VanEck estimates Strategy's annual preferred dividend payments will rise from $217 million in 2025 to $904 million in 2026, while the company's legacy software business generates only $477 million in annual revenue. Strategy repurchased $1.5 billion of its 2029 convertible notes at an 8 percent discount in May 2026, reducing near-term refinancing pressure on its capital structure.
Strategy Acquires Bitcoin Through Equity and Debt Offerings
Strategy acquires Bitcoin through equity issuances, convertible debt, and preferred stock offerings. The company does not sell Bitcoin. In 2025, Strategy raised $25.3 billion and added more than 225,000 Bitcoin, making it the largest equity issuer among U.S. public companies. The firm acquired its 843,738 Bitcoin at a total cost of $67 billion, according to its May 2026 SEC filing.
Michael Saylor, founder and executive chairman, described the approach in a May 2026 capital structure update: "Strategy has the flexibility to fund strategic transactions using cash, Digital Equity, Digital Credit, or Digital Capital, giving us multiple levers to optimize our balance sheet," according to the company's press release.
The company reports a year-to-date BTC Yield of 13.3 percent and a BTC Gain of 89,378 Bitcoin. The software business, now called Strategy ONE, generates roughly $477 million in annual revenue. The position dwarfs its legacy software operations.
Margin Call Risk Depends on Debt Instrument Terms
A margin call occurs when a lender requires additional collateral or repayment because the value of pledged assets has fallen below the required loan-to-value ratio. Strategy's exposure to this risk depends on its specific debt instruments and their terms.
Most of Strategy's debt consists of unsecured convertible notes, which do not carry traditional margin-call provisions. The company retired its only Bitcoin-collateralized loan, a $205 million Silvergate facility, in March 2023.
During the 2022 drawdown, Saylor noted on Bloomberg TV that the loan was "10 times overcollateralized" and that forced selling would only occur if Bitcoin fell by "a factor of 10," as reported by Crypto Valley Journal.
Convertible note maturities extend into the 2028 to 2030 window. Strategy could face difficulty refinancing maturing convertible notes, paying preferred stock dividends, or issuing new equity at favorable terms if Bitcoin's price drops substantially.
Polymarket Prices Margin Call Probability at 8.5 Percent
The Polymarket contract "Will MicroStrategy be margin called in 2026?" prices the YES outcome at approximately $0.09, implying an 8.5 percent probability. The contract defines a margin call as a lender formally requiring additional collateral or repayment when Bitcoin collateral falls below the required loan-to-value ratio. With only $3,014 in total liquidity, the contract is thin, but the directional signal aligns with broader institutional assessment.
VanEck's Matthew Sigel published a detailed analysis of Strategy's capital structure, estimating annual interest payments to reach $87 million by 2026. Preferred stock dividend payments are projected to rise from $217 million in 2025 to $904 million in 2026.
With projected revenue of only $475 million, Strategy depends on access to capital markets to cover its fixed-income obligations. Seeking Alpha analyst coverage in late 2025 downgraded Strategy to a sell rating, citing a NAV premium below 1 and concerns over dilution. Bankruptcy risk remained low, but structural headwinds were intensifying.
Strategy Faces SEC and Nasdaq Regulatory Scrutiny
Strategy's position as a Bitcoin treasury company operating in traditional public markets places it under scrutiny by both the SEC and Nasdaq's listing requirements. The company's new fair-value accounting rules, adopted under ASU 2023-08, contributed to a $12.5 billion accounting loss in Q1 2026 driven by unrealized Bitcoin write-downs.
Strategy Repurchased $1.5 Billion in Convertible Notes
Strategy's May 2026 debt repurchase reduced its convertible note obligations from $8.2 billion to $6.7 billion. The company maintains an $871 million USD reserve and has stated plans to replenish it based on market conditions.
FAQ
What is Strategy's total Bitcoin holdings as of May 2026?
Strategy holds 843,738 Bitcoin as of May 25, 2026, acquired at a total cost of approximately $67 billion, representing roughly 4 percent of Bitcoin's total supply.
What is the probability of a Strategy margin call in 2026?
The Polymarket contract assigns roughly an 8.5 percent probability to a Strategy margin call in 2026, pricing the YES outcome at approximately $0.09.
How much debt does Strategy carry?
Strategy carries $6.7 billion in convertible notes and $15.5 billion in notional preferred stock outstanding, with annual preferred dividend payments projected at $904 million in 2026 according to VanEck estimates.
