Strategy sold $109 million worth of Bitcoin to repurchase preferred shares
Strategy sold 1,690 bitcoins for approximately $109 million and used the proceeds to repurchase one of its preferred stock issues, rather than to increase its cryptocurrency reserves. This was reported by Fortune.
This is the company’s second Bitcoin sale in August. On August 3, Strategy sold approximately $105 million worth of cryptocurrency. Since announcing in late June that it might sell up to $1.25 billion worth of Bitcoin to build cash reserves, the company has made four such sales.
The latest sale took place seven weeks after Strategy’s previous Bitcoin purchase. Following the announcement, the company’s stock fell 1.5% at the opening bell but later recovered to $100. The price of Bitcoin briefly fell by 1% and then rose to $64,700, according to CoinGecko.
For more breaking news, follow the UA.News Telegram channel.
Strategy, formerly known as MicroStrategy, began adding Bitcoin to its balance sheet in 2020 under the leadership of CEO Michael Saylor. According to the company’s own data, the value of its Bitcoin holdings is approximately $54 billion, which represents about 4% of the total Bitcoin supply.
Fortune notes that Strategy has changed its approach amid a decline in the value of both Bitcoin and its own stock. Following the market crash on October 10, when more than $19 billion in leveraged cryptocurrency positions were liquidated, Bitcoin fell by nearly 43%, and MSTR shares dropped by nearly 70%.
The company traditionally financed its Bitcoin purchases by selling common and preferred stock and issuing convertible debt. It is now building up its dollar reserves to demonstrate to investors its ability to meet its financial obligations amid continued market volatility. CEO Fong Le stated on social media that Strategy’s dollar reserves and duration metric have reached record levels; according to him, over the past 2.5 months, the company has added nearly $3.8 billion and increased both metrics more than fivefold.
