Strategy bitcoin pause reaches five weeks as cash reserve rises
Strategy skipped Bitcoin buying for a fifth week, lifted cash to $3.75 billion and repurchased STRC preferred stock.
By Sofia Marchetti · Columnist
· 3 min read
The strategy bitcoin pause stretched to a fifth straight week, with the Bitcoin treasury company adding $525 million to cash reserves instead of buying more BTC, according to Decrypt’s Morning Minute and a company announcement. For retail investors watching MSTR, the move shifts attention from Bitcoin accumulation to liquidity, preferred-stock obligations and share issuance.
Strategy’s cash reserve now stands at $3.75 billion, according to Decrypt. That amount covers 2.1 years of the $1.76 billion in preferred dividends and debt interest the company owes each year, Decrypt reported.
The company sold 5,429,160 shares of MSTR common stock through its at-the-market program from July 20 through July 26, generating $544.5 million in net proceeds, the company said in an announcement cited by Decrypt. An at-the-market program lets a public company sell newly issued shares into the open market over time, rather than all at once through a traditional offering.
Strategy’s Bitcoin holdings remained at 843,775 BTC. Decrypt reported that the company has not added to that position since disclosing a 520 BTC purchase for $35 million on June 22.
Why did Strategy stop buying Bitcoin?
Strategy has not given a new Bitcoin purchase announcement for five weeks, and Decrypt described the run as its longest buying pause in two years. The reported cash build suggests the company is prioritizing liquidity while it manages annual preferred dividend and debt interest obligations.
The company also used cash for a different purpose: buying its own preferred stock. Strategy repurchased $25 million of STRC preferred stock, marking the first purchase under a $1 billion authorization approved by its board on June 29, according to Decrypt.
Preferred stock is a class of equity that usually sits ahead of common shares for dividend payments and claims on assets. STRC has traded below its $100 par value since mid-May and reached record lows earlier this month, Decrypt’s Morning Minute reported.
That matters for MSTR holders because the cash came after common-share sales. Issuing shares can dilute existing shareholders, meaning each existing share represents a smaller slice of the company unless the proceeds create enough value to offset the new share count.
What is changing in Strategy’s Bitcoin math?
Decrypt’s Morning Minute also pointed to recent changes in how Strategy presents its own metrics. The company introduced “net Bitcoin per share,” which Decrypt said excludes $22.2 billion in debt and preferred claims, and changed its mNAV calculation so the stock reads at 1.02x.
mNAV, or market net asset value, is a way investors compare Strategy’s stock-market valuation with the value of its Bitcoin-related balance sheet. Decrypt’s Morning Minute said the 1.02x level is close to the point where issuing shares to buy more Bitcoin would reduce Bitcoin per share.
Bitcoin and other major crypto assets were lower in the same market snapshot. Decrypt listed BTC down about 2.7% near $63,400, ETH down about 4% near $1,875 and HYPE down about 9% near $54.
Decrypt’s Morning Minute said Strategy’s Bitcoin stack was $8.5 billion below the $63.69 billion the company paid for it. The company’s earnings are due Thursday, when investors may get more detail on how Strategy plans to balance cash, preferred stock, share issuance and future Bitcoin purchases.
This story draws on original reporting from Decrypt.
