Strategy halts Bitcoin buys, shifts $333.7M to preferred equity

Michael Saylor's bitcoin accumulation flywheel is running in reverse.

Strategy Inc sold $333.7 million of stock last week without buying bitcoin, redirecting proceeds to preferred-share buybacks and a $4.8 billion reserve.

The company used $132.2 million to repurchase 1,388,720 shares of its variable-rate preferred stock STRC, allocated $52.4 million to STRC dividends, and added roughly $150 million to its U.S. dollar reserve, according to a Monday filing.

Bitcoin holdings remain unchanged at 840,447 BTC, acquired for $63.36 billion at an average price of $75,385 per coin including fees. The reserve now covers 2.8 years of obligations, supporting dividend payments on preferred stock and interest on outstanding debt.

The pivot marks a break from the accumulation blueprint Saylor pioneered. Strategy hasn't purchased bitcoin since mid-June, and over the past five weeks has sold about $2.1 billion of common stock while buying back roughly $347 million of STRC preferred shares. The company also sold $213.3 million of bitcoin during that period.

STRC, Strategy's perpetual preferred stock paying 12 percent annual dividends, trades at $95.73 — below its $100 par value target. The dividend rate adjusts monthly to encourage trading around par, a mechanism designed to strip away price volatility. If investors buy STRC near $100, the company can issue new preferred shares at roughly that price and use the proceeds for bitcoin purchases. But at $95.73, Strategy raises about 10 percent less capital per share, and investors demand a higher yield to compensate for the lower price, increasing financing costs.

The company has $653 million remaining under its preferred-stock repurchase program and $1 billion available under its MSTR common-stock repurchase program.

The shift coincides with OranjeBTC's plan to launch DIGY11, an exchange-traded fund on Brazil's B3 exchange in early September. The fund will allocate 95 percent of its portfolio to STRC and 5 percent to SATA, the preferred shares issued by Strive Inc., which holds 20,167 BTC on its balance sheet. For a preferred equity to qualify for DIGY11, the issuer must hold at least 50 percent of its total assets in bitcoin and a minimum of 4,000 BTC.

Strategy's pause removes a major source of corporate bitcoin buying pressure. MSTR shares rose 1.3 percent in premarket trading, while bitcoin gained more than 1 percent over the past 24 hours to trade near $63,500. The stock is down about 73 percent over the past year.

The shift could influence other corporate treasuries weighing bitcoin accumulation strategies, as Saylor's "never sell" approach gives way to a capital management framework focused on liquidity and preferred equity. With $653 million still available for STRC buybacks and $1 billion for common-stock repurchases, the company retains significant flexibility in its new capital management posture.

This article is for informational purposes only and does not constitute investment advice.