The US-based software entity, now going by the name Strategy, has drastically increased its Bitcoin acquisitions recently. Between May 4 and May 10, the firm added 535 Bitcoin to its portfolio, as documented in a recent SEC filing. The purchases totaled around $43 million, averaging $80K per Bitcoin.
How are acquisitions impacting their portfolio?
With these new purchases, Strategy’s Bitcoin holdings have soared to 818,869 BTC. Acquired at an average price of $75,540 each, the firm remains in a good spot given Bitcoin’s market price touched above $81,000 during the acquisition period, maintaining a profitable stance.
Where did the funding come from?
To fund this acquisition, Strategy tapped into its Class B common shares and Stretch perpetual preferred shares. Through these channels, they procured around $42.9 million. Strategy’s stock (MSTR) wrapped up the week at $187.59, up by 9.8%, though it still lags behind its 2025 highs.
Known for its aggressive Bitcoin strategy, Strategy stands out among public firms. Executive Chairman Michael Saylor is a well-known proponent, frequently sharing insights into the firm’s Bitcoin strategy. Recent updates signaled a resumption of their buying spree after a financial report revealed a hefty Q1 loss.
Michael Saylor mentioned, “The company may decide to sell Bitcoin to manage dividend payments or debt, part of a long-term plan to increase Bitcoin per share.”
Even considering potential Bitcoin sales, Saylor noted the plan to strategically reinvest under favorable terms to further increase Bitcoin holdings per share. This is central to Strategy’s vision.
Understanding STRC and its implications
An integral part of Strategy’s funding approach is the STRC share with an 11.5% annual dividend. Different from bonds, STRC lacks immediate cash redemption, offering a steady capital inflow while ensuring dividend commitments.
Rethinking dividend payouts from monthly to semi-monthly, Strategy aims for faster reinvestment and better liquidity. Alongside STRC, it runs other preferred shares like STRK, STRF, and STRD, aiming for $84 billion by 2027. The company adjusts its strategies based on factors like Bitcoin price trends.
Following recent discussions, Peter Schiff criticized Strategy’s approaches and products like STRC. He termed them high-risk, unsuitable for capital preservation-focused retirees, and akin to Ponzi schemes, raising concerns about potential legal ramifications.
Saylor defended, framing Bitcoin as “digital capital.” He emphasized that their financial models support expanding Bitcoin holdings and sustain Strategy’s long-term growth vision.
