Strategy continues buying bitcoin despite the fragility of its main financing tool. Michael Saylor’s company invested about 35 million dollars in 520 additional BTC, bringing its reserves to
Strategy continues buying bitcoin despite the fragility of its main financing tool. Michael Saylor’s company invested about 35 million dollars in 520 additional BTC, bringing its reserves to 847,362 bitcoins. A modest purchase at its scale, but meaningful as the STRC continues to lose ground.
Strategy acquired 520 BTC for about 35 million dollars over the past week. The company thus continues its accumulation after already dedicating 100 million dollars to its previous purchase. This new operation brings its holdings to 847,362 BTC. Strategy remains by far the leading publicly traded bitcoin holder. Its reserve now represents a little over 4% of the maximum supply of 21 million bitcoins.
However, the size of the purchase confirms a slowdown. The company recently made acquisitions sometimes exceeding one billion dollars. The 35 million committed this time shows that its financing capacity is becoming more constrained. The main problem comes from the STRC, a perpetual preferred share designed to trade around 100 dollars. This security pays a variable dividend that Strategy can adjust to support its price and attract new investors.
The STRC has nevertheless dropped significantly below its target value. This decline complicates new issuances. Strategy generally avoids selling STRC shares under 100 dollars, as such a transaction would be less advantageous and increase the cost of raised capital. This product had however played a major role in previous acquisitions. In May, STRC sales had financed most of a 2 billion purchase made by the company.
The weakness of the stock thus reduces the fuel available for bitcoin. It forces Strategy to use other levers, especially sales of ordinary MSTR shares, its dollar reserves, or other preferred securities.
Your 1st cryptos with CoinbaseThis link uses an affiliate program.The STRC currently pays a high annual dividend. This yield was supposed to appeal to investors seeking regular income, while enabling Strategy to raise funds to buy more Bitcoin.
But this mechanism becomes more expensive when the stock declines. To bring it closer to its target value, the company may raise its dividend. It then increases its financial obligations at the very moment when its ability to raise capital decreases. The group therefore remains dependent on new share issuances, its reserves, or, as a last resort, bitcoin sales.
This pressure explains the recent sale of 32 BTC. The operation was tiny compared to total reserves, but it broke the narrative that Strategy would never sell its bitcoins. Michael Saylor continues to defend Bitcoin as a digital capital superior to traditional assets. Yet, Strategy’s model no longer relies solely on BTC’s rise. It also depends on the behavior of MSTR, STRC, and other financial instruments issued by the company.
The real test no longer only concerns the price of Bitcoin. It concerns the resilience of the entire financial architecture built around it. After doubts caused by the drop in STRC, Strategy must prove it can continue accumulating without weakening the instruments that finance its bet.
