Bitcoin

Strategy Spent Nearly 9 Times More on Buybacks Than on Bitcoin

Strategy added just 250 BTC last week, while spending $192.4m buying back its own preferred stock.

⏱ 2 min read Bitcoin
Quick Summary
  • Strategy now holds a record 848,250 BTC, bought for about $64bn at an average of $75,444 per coin
  • The week before showed the same pattern, with $176m spent on buybacks and $29m on Bitcoin
  • Strategy has said it could sell up to $1.25bn of Bitcoin under its digital credit capital framework

Strategy bought 250 BTC last week for about $21.5 million. In the same week, it spent $192.4 million buying back shares of its own preferred stock, nearly nine times as much.

The purchases, made between 5 and 11 October at an average of $86,194 per coin including fees, take Strategy’s holdings to a record 848,250 BTC. It has paid about $64 billion for them in total, an average of $75,444 per coin.

Where the money went

The larger spend went on STRC, Strategy’s variable-rate “Stretch” preferred stock. The company repurchased 1,932,145 shares, at an average of just under $100 each. It still has $354.8 million left under the buyback programme, and it sold no preferred stock during the week.

The Bitcoin was paid for mainly by selling about 125,000 shares of its common stock, MSTR, through its at-the-market programme, which raised about $21 million.

Two weeks, same pattern

This was not a one-off. The week before, Strategy bought $29 million of Bitcoin and spent $176 million buying back STRC.

The company also has room to sell Bitcoin if it chooses. Under its capital framework, it has said it could sell up to $1.25 billion of BTC, and chief executive Phong Le defended selling Bitcoin as the “right trade” in September.

Plenty of cash

Strategy held $5.5 billion in US dollar assets at 11 October. Of that, $4.88 billion sits in a reserve for preferred dividends and debt interest, and $640.5 million is cash available for broader uses, including buying Bitcoin.

It has also proposed that dividends on its preferred stock should accrue every day of the year.

⚖️ Our Verdict ⚖️ Watch and Wait

Strategy is still adding Bitcoin, but for two weeks running most of its money has gone into buying back its own preferred shares. That points to a company focused on managing its funding costs rather than adding coins, a shift worth watching in the market's largest corporate buyer.