In brief – Strategy used 61% of its dedicated cash buffer ($1.38 billion) to repurchase $1.5 billion in convertible notes. – Despite earlier corporate signals, the firm’s entire stash of 843,738 Bitcoin remained untouched during the debt repurchase. – Although Bitcoin’s price…
s fallen roughly 12% year-to-date, the Bitcoin buying firm’s common shares have advanced 8.8% since January. Strategy burned through most of its cash reserves while extinguishing debt last week, leaving the Bitcoin-buying firm with fewer funds on hand to pay preferred stockholders
The Tysons Corner, Virginia-based firm now has $871 million set aside to pay dividends and service debt, representing a $1.38 billion drawdown, Strategy said in an announcement. The company had previously earmarked $2.25 billion for such purposes. This month, the Bitcoin-buying firm’s leadership signaled that Strategy could employ the full scope of its resources while managing its massive debt burden.
That included the possibility that the world’s largest Bitcoin holder could sell the digital asset for the first time in years. Instead, the company took a 61% chunk out of its cash reserves, a buffer created in December to calm investor anxiety and prevent Strategy—which currently owns 843,738 Bitcoin worth $64.7 billion—from having to offload the digital asset at depressed prices. On Myriad, a prediction market owned by Decrypt parent company Dastan, traders penciled in a 71% chance that Strategy sells Bitcoin this year.