Strategy's Bitcoin Holdings Dip Below 844,000 BTC Following $216 Million Sale
- 14 hours ago
- 2 min read
Strategy sold 3,588 bitcoin for about $216 million last week, using the proceeds to fund preferred stock distributions and rebuild its cash reserves, according to an 8-K filing with the U.S. Securities and Exchange Commission on Monday.
The sales mark one of the first uses of the company's recently adopted BTC Monetization Program, which authorizes bitcoin sales to fund preferred dividends, interest payments, share repurchases and reserve management.
The company said it sold 1,363 BTC for approximately $80.8 million between June 29 and June 30 at an average price of $59,256 per bitcoin, followed by another 2,225 BTC for about $135.2 million between July 1 and July 5 at an average price of $60,773.
According to the filing, the proceeds restored Strategy’s U.S. dollar reserve to $2.55 billion as of July 5. Under its recently adopted Digital Credit Capital Framework, the reserve is designated for preferred stock dividends and interest payments and must cover at least 12 months of those obligations.
Following the sale, Strategy's 843,775 BTC were acquired for approximately $63.7 billion, including fees and expenses, at an average purchase price of $74,476 per bitcoin, according to Executive Chairman Michael Saylor.
Based on current market prices, the holdings are valued at roughly $52.3 billion.
Grayscale Comments on Strategy's Bitcoin Sale
Grayscale, the digital asset manager, said Strategy’s recent sales should strengthen investor confidence in the company’s financing structure.
Zach Pandl, Grayscale’s head of research, noted in a Monday note that Strategy’s balance sheet carries approximately $52 billion in bitcoin against roughly $7 billion in debt. Annual dividend obligations on preferred equities total less than $2 billion.
“On the surface there is nothing wrong with Strategy’s balance sheet,” Pandl said. “Strategy clearly has sufficient financial resources to service its debt and dividend obligations.”
Pandl pointed to the rebound in STRC, Strategy’s preferred stock, as evidence of increased investor confidence in the instrument. Following the sale, Strategy’s cash reserves of $2.55 billion now cover an estimated 17 months of dividend payments, exceeding the company’s newly established minimum target of 12 months.
Grayscale said the fortified cash position could help establish a more durable price floor for bitcoin by reducing tail risks associated with Strategy’s need to liquidate assets to meet obligations.
Meanwhile, in its second-quarter financial update contained in the filing, Strategy reported an $8.32 billion loss on digital assets. This figure comprises an $8.31 billion unrealized loss and a $0.9 million realized loss.
The company stated it would fully offset the related deferred tax benefit with a valuation allowance, reflecting that the market value of its bitcoin fell below its purchase cost at the end of the quarter.
Last week, Strategy also approved a $1 billion Digital Credit Securities Repurchase Program covering its STRC, STRF, STRD and STRK preferred securities, alongside a separate $1 billion Class A common stock repurchase authorization. The company said the BTC Monetization Program currently has its full $1.25 billion capacity available.
This content is for informational purposes only and should not be taken as solicitation, recommendation, endorsement or investment advice. It is crucial for you to conduct your own research and due diligence to make informed decisions, as any investment will be your sole responsibility. Please review our disclaimer and risk warning.
