Strategy · Bitcoin · CryptoSlate
Strategy applied $300 million of MSTR dilution to backstop its Bitcoin’s biggest buying machine
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Strategy (formerly MicroStrategy) raised $335.5 million by selling common stock last week, then placed almost 90% of the proceeds into cash rather than Bitcoin as the company moved to shore up the preferred securities financing its cryptocurrency purchases.
Key facts
- At a $90 purchase price, STRC’s $11.50 annual dividend would amount to an effective yield of about 12.8%
- The company sold about 2.71 million MSTR shares between June 15 and June 21 and added $300 million to its US dollar reserve, lifting the fund to $1.4 billion
- STRC initially recovered above $91 following the reserve announcement, then closed Monday at $88.64
- Strategy Chief Executive Officer Phong Le disclosed that he bought $1 million of STRC during the decline and planned to hold the position until it reached $100, and potentially longer
Summary
01 Strategy sold $335.5 million of MSTR, put $300 million into cash, and bought only 520 Bitcoin. 02 The cash build aims to support preferred dividends after STRC slid to a record intraday low and weakened a key funding channel. 03 MSTR dilution rose, Bitcoin yield fell, and further common-stock sales may stay under pressure unless STRC recovers. The company sold about 2.71 million MSTR shares between June 15 and June 21 and added $300 million to its US dollar reserve, lifting the fund to $1.4 billion.