Strategy Repurchases $193.1 Million in STRC and Increases Bitcoin Holdings by 267 BTC
Strategy (formerly MicroStrategy) repurchased approximately $193.1 million in STRC preferred shares and acquired 267 BTC between October 12 and 18, raising its total holdings to 848,517 BTC, with USD assets around $5.3 billion.
The company purchased 267 BTC at an average price of about $82,900 each (including fees), with a total cost of $22.1 million; the funds mainly came from selling 140,872 shares of MSTR common stock through an ATM program, generating $22 million, plus $100,000 in cash.
During the same period, 1,938,780 shares of STRC (variable rate Series A perpetual Stretch preferred stock) were repurchased at an average of about $99.60 per share, funded by USD Cash; the board increased the buyback limit for digital credit securities from $2 billion to $3 billion, with approximately $1.16 billion remaining as of October 18.
As of October 18, the company held a total of 848,517 BTC, with a total acquisition cost of about $64.02 billion, averaging $75,446 per BTC; during the same period, approximately $45.5 million in preferred stock dividends were paid using USD Reserve, which is about $4.83 billion, and USD Cash is about $447.3 million.
This week, the amount spent on STRC repurchases was nearly nine times that of Bitcoin purchases; the company did not sell any preferred shares nor repurchase other series of preferred shares or MSTR common stock.
This transaction continues the company's strategy of supporting STRC prices close to the $100 par value through preferred stock buybacks while maintaining a continuous increase in Bitcoin holdings.
Market Mechanism: The company conducts Bitcoin purchases and preferred stock buybacks in parallel by selling common stock and using cash reserves, directing funds into the Bitcoin market and optimizing its capital structure, benefiting from stable Bitcoin prices and preferred stock investors, while facing pressure from ongoing buybacks that consume cash and the risk of common stock dilution.
Source: Public Information
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Led by Michael Saylor, Strategy has used Bitcoin as a primary reserve asset since 2020, continuously financing Bitcoin purchases through common stock ATM issuances and preferred stock instruments; the company has repeatedly expanded its digital credit securities buyback program, prioritizing repurchases of STRC priced below $100 par value to support its price and capital structure.
In terms of capital pathways, this week funds raised from selling MSTR common stock were used to purchase Bitcoin, while USD Cash was used for large-scale STRC buybacks, making the scale of preferred stock repurchases far exceed Bitcoin purchases; the motivation is to maintain STRC close to par value to facilitate future issuances while continuing to increase Bitcoin positions.
Similar to traditional companies managing capital costs and equity structures through preferred stock buybacks, or businesses repurchasing debt instruments with cash in a low-interest environment; currently, Strategy is in a phase of continuously increasing Bitcoin holdings while optimizing its preferred stock capital structure, with preferred stock buybacks becoming routine operations.
Structurally, this represents capital concentration and pricing power transfer: through a combination of preferred stock buybacks and common stock issuances, funds are reallocated to Bitcoin assets, with the mechanism being to anchor around the par value of preferred stock prices, lowering financing costs and strengthening the proportion of Bitcoin holdings, further tilting the company's capital structure towards digital assets.
ABAB News · Cognitive Laws
Repurchasing preferred stock costs more than increasing Bitcoin holdings
When close to par value, buybacks support issuance space
Cash reserves are used to buy both Bitcoin and structural stability