Strategy acquired 1,550 Bitcoin for $101 million and boosted cash reserves to $1 billion after a significant stock decline.
Summary
- Strategy has purchased 1,550 Bitcoin for $101 million, raising total holdings to 845,256 BTC.
- The company has restored cash reserves to $1 billion after previously using a significant amount for debt buybacks.
- This acquisition comes after a notable decline in stock following Strategy's first Bitcoin sale in over three years.
On Monday, Strategy announced a purchase of 1,550 Bitcoin for $101 million, marking a significant operational rebound after experiencing its steepest weekly decline since November 2022.
Based in Tysons Corner, Virginia, the firm revealed in an SEC filing that it now holds a total of 845,256 Bitcoin. With Bitcoin priced at approximately $63,000, this amounts to a total valuation of about $53.3 billion, as per CoinGecko data.
Following the acquisition announcement, shares of the Bitcoin-focused company rose by 3.4% to over $124, although they had fallen 24% the previous week after the firm disclosed its first Bitcoin sale in over three years.
The sale involved just 32 Bitcoin for $2.5 million, a small portion of its overall holdings, prompting questions about the confidence in the firm's co-founder and Executive Chairman Michael Saylor and his strategy for the largest corporate Bitcoin holder.
In the latest SEC report, Strategy confirmed that it has significantly bolstered its cash reserves, which now stand at $1 billion, despite setting aside $80 million to manage upcoming dividend payments and debt obligations.
Last month, the company had reduced its cash reserves by 61% to repurchase debt, which limited its ability to meet dividend obligations on preferred stock. Previously, it had earmarked $2.25 billion in cash for its Stretch (STRC) initiative.
As of Monday, the price of STRC was $94.72, approaching its $100 par value. Historically, when shares exceed this value, the company has issued STRC and used the proceeds to acquire more Bitcoin, a strategy that has proven profitable this year.
Bitcoin recently fell to $59,400, its lowest since October 2024, increasing unrealized losses on Strategy's holdings, which are currently around $10.7 billion in the red.
During a recent earnings call, Saylor indicated that selling some Bitcoin might be necessary to support the company's commitment to an annual dividend of 11.5% for STRC, distributed monthly. He remarked succinctly on social media about the recent sale, noting it represented just 0.0038% of total holdings.
