MicroStrategy Builds $1.44B USD Reserve as Bitcoin Buying Slows — Preparing for Prolonged Weakness
MicroStrategy has created a $1.44 billion USD cash reserve, funded via at‑the‑market MSTR share issuances, to cover preferred-share dividends, bond interest and to provide liquidity amid rising Bitcoin volatility. The company plans to expand this buffer to cover 12–24 months of obligations. On-chain analytics firm CryptoQuant interprets the shift to a dual-reserve strategy (cash + BTC) as MicroStrategy preparing for prolonged or deeper Bitcoin weakness and reduced capital‑market support for equity issuance. CryptoQuant highlights a sharp slowdown in MicroStrategy’s BTC accumulation — monthly purchases fell from ~134,000 BTC in November 2024 to ~9,100 BTC in November 2025, with only ~135 BTC added in early December — coinciding with Bitcoin’s pullback from its $126k all-time high to around $93k. CryptoQuant’s Bull Score has dropped to zero and its head of research projects Bitcoin could trade in a $70,000–$55,000 range next year if bearish conditions persist. MicroStrategy says the USD reserve is a liquidity tool, not a signal of imminent BTC sales; management prefers hedging with derivatives and selective sales only as a last resort. Mizuho has maintained an ‘Outperform’ rating on MSTR with a $484 target. Implications for traders: the firm’s reduced guaranteed buy pressure removes a major institutional demand tailwind, which could dampen upside during rallies (bearish for BTC price momentum). Conversely, larger cash buffers and use of derivatives lower the risk of forced, large-scale BTC liquidations from MicroStrategy, reducing the likelihood of extreme volatility from a single holder. Primary keywords: MicroStrategy, Bitcoin, USD reserve, CryptoQuant, MSTR, BTC.
Bearish
The net effect on BTC price is likely bearish. Key reasons: 1) MicroStrategy’s creation and planned expansion of a $1.44B USD liquidity reserve signals a strategic pivot from aggressive BTC accumulation to a liquidity-first posture, removing a predictable, large-scale buyback/demand sink that previously supported price during pullbacks. Reduced monthly purchases (from ~134,000 BTC to ~9,100 BTC) materially lower a major institutional bid that traders priced into markets. 2) CryptoQuant’s downgraded Bull Score and range forecast ($70k–$55k) reflect persistent bearish momentum that could keep upside capped. 3) On the stabilizing side, larger cash buffers and reliance on derivatives reduce the risk of forced liquidation by MicroStrategy, which should limit episodic flash crashes caused by a single large seller. Overall, expect weaker upward pressure and higher probability of sideways-to-down price action in the short-to-medium term; volatility spikes caused by other factors remain possible but the specific tail-risk from MicroStrategy-driven forced sales is reduced. Traders should account for diminished institutional accumulation when assessing upside targets, but also note lower liquidation risk when sizing positions and planning risk management.