"We’ll continue to build that. And yeah, when Stretch gets back to par, we’ll issue more. We’ll buy more Bitcoin," said Phong Le, CEO of Strategy, illustrating the company's plans for future Bitcoin acquisitions. Strategy's forthcoming Bitcoin purchases hinge on the recovery of its preferred stock, STRC, which is currently trading around $87, below its $100 par value.
To bolster its cash reserves, Strategy sold 3,588 BTC over a two-week span. This move was part of a strategy to enhance liquidity while managing dividends and interest payments. Strategy's liquidity now stands at $3 billion, thanks to the sale of approximately $466 million worth of MSTR shares. Maintaining this cash allows the company to avoid relying solely on its Bitcoin holdings, adding a layer of financial security.
Le has emphasized the necessity of cash reserves as a means to restore confidence in STRC, especially after it dipped below $75 in late June. The preferred stock serves as a significant fundraising mechanism for Strategy, enabling them to issue new shares and allocate proceeds toward Bitcoin purchases. However, the attractiveness of this strategy diminishes if STRC trades below par.
Despite recent sales, Strategy maintains a significant advantage over BlackRock’s spot Bitcoin exchange-traded fund, with 843,775 BTC in holdings compared to BlackRock's reported 733,516 BTC. Notably, executive chairman Michael Saylor has highlighted the comparative exposure that MSTR and STRC offer investors, arguing that Strategy’s securities provide substantial Bitcoin exposure alongside their operational ventures.
This material is for informational purposes only and should not be considered as financial advice.
