Strategy, formerly known as MicroStrategy, acquired 334 Bitcoin for $28.7 million last week while allocating $176.3 million toward repurchasing its own preferred stock, according to a Monday filing with the U.S. Securities and Exchange Commission (SEC).
The transaction represents the firm's third consecutive weekly Bitcoin purchase, though it marks a significant slowdown from the 1,665 BTC acquired the prior week. The addition brings Strategy's total treasury stash to exactly 848,000 BTC.
Treasury Funds Shift Toward Preferred Shares
According to the regulatory filing, Strategy bought back approximately 1.77 million shares of Stretch (STRC), a preferred stock class that carries a 12% annual dividend. To fund the repurchases, the firm pulled $154.1 million from its USD Cash pool, while deploying just $13 million from the same balance toward Bitcoin.
The remaining $15.7 million for the Bitcoin purchase was raised by issuing 92,894 new MSTR common shares. Strategy previously stated it plans to maintain the 12% dividend rate on STRC until the security trades consistently near its $100 issue price. Gold advocate Peter Schiff claimed Strategy lost its primary Bitcoin buying engine after STRC ceased raising net capital.
Unregistered Gains and Reserves
Despite the slower weekly accumulation rate, Strategy estimated a $20.91 billion gain on its Bitcoin holdings for the third quarter. This recovery allowed the company to reverse a $4.12 billion tax asset tied to earlier unrealized losses.
With Bitcoin trading near $85,377, as Bitcoin holds above $85,200, the company's holdings are valued at roughly $72.4 billion. Strategy paid a aggregate purchase price of $63.97 billion, averaging $75,441 per coin. Balance sheet liquidity remains substantial, with a $4.88 billion USD Reserve dedicated to dividends and interest alongside $833.4 million in USD Cash. Stockholders are scheduled to vote on October 28 regarding a proposal to distribute daily dividends across all four of Strategy's preferred share classes.
Key Takeaways
- 334 BTC added: Strategy spent $28.7 million on Bitcoin last week, lifting total holdings to 848,000 BTC.
- $176.3M spent on buybacks: The company allocated six times more capital to buy back 1.77 million STRC shares than to buy crypto.
- $20.91B Q3 Gain: Rebound in valuations allowed Strategy to reverse a $4.12B tax asset from previous losses.
- Average Cost: Strategy's total purchase basis stands at $63.97 billion or $75,441 per coin.
Why It Matters
Strategy's pivot toward aggressive preferred share buybacks highlights the structural cost of maintaining high-yield dividend vehicles like STRC. When secondary market prices drift from par, corporate capital must be diverted from direct Bitcoin purchases toward price defense and dividend servicing. Investors should watch the October 28 shareholder vote on daily dividend distributions, as increased cash outflows could continue to constrain the firm's spot market buying power.
