Strategy sells $395 million in Bitcoin and MSTR stock to buyback $81 million in STRC and build cash reserve to $4 billion
Strategy’s newest Bitcoin sale lifted its 2026 disposals to 5,258 BTC, the biggest quantity it has bought in any 12 months since adopting the asset in 2020, as the corporate redirects capital towards supporting its most popular securities.
The firm bought 1,638 BTC for $104.7 million between July 27 and Aug. 2 and issued about 3.01 million MSTR widespread shares for one more $290.6 million, in accordance to an Aug. 3 filing with the US Securities and Exchange Commission.
None of the practically $395 million raised went towards new Bitcoin purchases. Instead, Strategy used the capital to fund most popular dividends, repurchase STRC shares and full the enlargement of its US greenback reserve to $4 billion.
The allocation prolonged its Bitcoin acquisition pause to six consecutive weeks, its longest since 2024.
STRC’s low cost forces Strategy to redirect capital
The most quick impediment to Strategy resuming Bitcoin purchases is STRC, a variable-rate preferred stock the corporate needs to set up as a repeatable funding supply for its treasury.
When STRC trades close to its $100 said quantity, Strategy can concern further shares round par and deploy the proceeds throughout its capital construction, together with towards Bitcoin purchases.
Trading at a sustained low cost weakens that channel as a result of new issuance would require both a decrease sale worth or the next dividend yield to entice buyers.
STRC has remained below par since May regardless of a dividend construction that permits Strategy to regulate the payout to help its market worth. The firm has responded by elevating the annual dividend fee to 12% and repurchasing shares at a reduction.
Last week, Strategy used $52.3 million from its Bitcoin sale and $28.9 million from its MSTR issuance to purchase again 912,143 STRC shares for $81.2 million.
The transaction adopted a $25 million repurchase the earlier week, when the company acquired 288,930 shares at an average price of $86.53.
During the company’s second-quarter earnings call, Strategy President and CEO Phong Le stated shopping for STRC beneath par permits the corporate to retire future dividend obligations at a reduction whereas strengthening demand because the shares transfer towards $100.
Strategy has now spent about $106.2 million on STRC repurchases since launching this system in July. It retains $893.8 million underneath its preferred-stock repurchase authorization, whereas a separate $1 billion authorization for MSTR common-share buybacks stays unused.
The firm is focusing on a return to par for STRC by September, with the tempo of additional purchases depending on the stock’s worth and market liquidity.
Reaching that concentrate on would restore a financing channel that has change into more and more essential to Strategy. The firm raised $7.53 billion by means of its capital packages in 2026 by means of July 26 as most popular securities assumed a bigger position in funding its steadiness sheet.
A $4 billion reserve protects most popular funds
Strategy additionally used final week’s common-stock issuance to full a fast enlargement of the cash reserve supporting its most popular dividends and debt curiosity.
Of the $290.6 million raised by means of MSTR sales, $250 million was transferred to the US greenback reserve, and $11.7 million was retained as cash.
The firm had already elevated the reserve from $2.55 billion on the finish of June to $3.75 billion by July 26, primarily by means of common-stock issuance. The newest allocation lifted it to the $4 billion goal.
Strategy estimated its annual preferred-dividend and debt-interest obligations at about $1.76 billion when it launched its revised capital framework in June. At that fee, the reserve would cowl roughly 27 months of funds.
Without additional board approval, the funds can be utilized solely to pay most popular dividends and curiosity on excellent debt.
The reserve reduces the chance that Strategy would wish to concern securities or promote Bitcoin underneath unfavorable market circumstances merely to meet near-term obligations. It additionally supplies most popular buyers with a devoted supply of cash even when Bitcoin costs fall or entry to capital markets deteriorates.
That safety, nonetheless, was largely financed by means of common-stock dilution.
Strategy issued about 3.01 million MSTR shares final week with out buying further Bitcoin. At the identical time, its treasury declined by 1,638 BTC, decreasing the quantity of Bitcoin represented by every assumed diluted widespread share.
Longtime Bitcoin critic Peter Schiff stated the transactions confirmed Strategy more and more utilizing Bitcoin gross sales and MSTR issuance to shield most popular buyers.
The impact was seen in the corporate’s Bitcoin-per-share efficiency measures. Strategy’s year-to-date BTC Yield fell to 3.5%, in contrast with 13.3% in late May. Its quarter-to-date BTC Yield stood at -4.6%, whereas its BTC Gain declined by practically 40,000 BTC, equal to about $2.4 billion at present costs.
Strategy defines BTC Yield as the share change in Bitcoin held per assumed diluted share. BTC Gain converts that share grow to be an estimated variety of Bitcoin.
The firm cautions that neither measure represents shareholder returns, revenue, cash circulation, or its skill to meet monetary obligations.
The reserve subsequently strengthens Strategy’s skill to meet most popular and debt funds, but it surely shifts extra of the financing burden onto MSTR shareholders whose publicity will depend on Bitcoin accumulation outpacing dilution.
Bitcoin turns into an energetic supply of liquidity
Strategy’s aggressive Bitcoin promoting this 12 months exhibits that the asset is now getting used as an operational supply of liquidity for the securities enterprise constructed round its treasury.
Indeed, the corporate bought 32 BTC in late May, 1,363 BTC on June 29 and 30, 2,225 BTC through the first 5 days of July, and one other 1,638 BTC final week.
Bitcoin analyst Will Clemente said these transactions offered better readability about how Strategy intends to steadiness the pursuits of Bitcoin holders, MSTR shareholders and most popular buyers.
The gross sales confirmed that administration was ready to transfer capital throughout its steadiness sheet slightly than permit stress in one safety to weaken the broader financing construction, he stated.
Strategy formalized that flexibility by means of its BTC Monetization Program. The framework authorizes the corporate to promote Bitcoin to improve its greenback reserve by as a lot as $1.25 billion, pay most popular dividends and debt curiosity, and finance repurchases of most popular or widespread shares.
Sales outdoors these functions or past the accepted limits would require further board authorization.
Executive Chairman Michael Saylor has rejected claims that this system represented a breach of a proper promise to maintain each Bitcoin indefinitely.
He said:
“Strategy introduced its BTC Monetization Program on June 29, 31 days earlier than our Q2 outcomes, not after posting a loss. We have by no means had a ‘by no means promote’ coverage. The program doesn’t require any BTC sale, and we count on to stay a internet purchaser of Bitcoin over time.”
Strategy stays the biggest company holder of Bitcoin, with 842,138 BTC representing simply over 4% of the asset’s most provide of 21 million cash.
The firm acquired these holdings for $63.51 billion at a median worth of $75,419. With Bitcoin buying and selling close to $62,633 as of press time, the treasury was value roughly $52.7 billion, inserting its market worth about $10.8 billion beneath Strategy’s combination acquisition price.
That hole will increase the price of additional monetization. Additional gross sales beneath the corporate’s common buy worth would crystallize losses whereas decreasing the Bitcoin supporting its increasing construction of widespread shares, most popular securities and recurring dividend obligations.
Saylor’s expectation that Strategy will stay a internet purchaser subsequently relies upon more and more on whether or not restoring STRC to par permits the corporate to resume elevating capital with out persevering with to dilute MSTR shareholders or draw down its Bitcoin treasury.
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