Strategy sold $105 million worth of Bitcoin for stock buybacks, while BitMine expanded its ETH holdings significantly.
Strategy recently sold 1,638 BTC, amassing around $104.7 million at an average price of $63,957 per coin between July 27 and August 2. This transaction, detailed in an 8-K filing with the SEC, brings the company's total Bitcoin holdings to 842,138 BTC, equating to roughly 4% of the entire Bitcoin supply, valued at approximately $52.6 billion. However, this is a significant drop from their initial investment of $63.51 billion, resulting in an unrealized loss of about $10.9 billion.
Funds Shifted Towards Dividends and Buybacks
The funds generated from the Bitcoin sale have been directed towards paying preferred stock dividends and repurchasing shares of STRC. In just a week, the company managed to buy back 912,143 shares for $81.2 million, while also raising $290.6 million by issuing 3.01 million common shares of MSTR. The dollar reserve has risen to $4 billion, bolstered by $250 million from the recent sale.
Strategy has confirmed its commitment to maintaining a 12% annual dividend rate for STRC, planning no reductions until the stock price stabilizes near $100. In pre-market trading, MSTR shares dipped by 0.3%, and Bitcoin saw a slight decline of 0.8%, trading around $62,700.
Shift in Sales Strategy
The company's recent approach indicates a shift, as CEO Michael Saylor highlighted the dynamics of their Bitcoin treasury operations through social media, suggesting ongoing changes in their strategy. Previously, Saylor’s posts often signaled purchases, but they now reflect a broader capital management strategy introduced in June, which limits the use of dollar reserves to dividends and interest payments and allows for stock buybacks up to $1 billion while capping Bitcoin sales at $5 billion.
Before this sale, Strategy had paused purchases for five weeks, maintaining a balance of 843,775 BTC. The company reported a net loss of $8.22 billion in its second-quarter results, primarily due to cryptocurrency asset revaluation. CEO Fong Lee mentioned that future coin sales would depend on commercial viability, noting that capital raised through STRC would no longer be automatically reinvested into Bitcoin.
BitMine Expands Its Holdings
Meanwhile, BitMine Immersion Technologies has acquired 10,399 ETH, increasing its total Ethereum holdings to 5.7 million, which constitutes 4.8% of the total circulating supply of ETH. The company values its total assets at $11.3 billion, which includes 209 BTC, alongside cash and marketable securities valued at $173 million, plus stakes in Beast Industries and Eightco.
BitMine has staked 4.9 million ETH, projecting annual revenue of $247 million from these operations, with a seven-day return of 2.67%. Additionally, BitMine has repurchased 4.5 million of its common shares since July 1, contributing to a total of 16.1 million shares bought back as part of a $4 billion program. Notably, Strategy previously sold 3,588 BTC for $216 million to fund quarterly dividends on four classes of preferred stock, highlighting the lack of systematic rules in their cryptocurrency transactions, as noted by CryptoQuant.
