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Strategy adds 2,486 BTC in delayed weekly buy as STRC funds deal

In this post:

  • Strategy added 2,486 BTC to its treasury.
  • The playbook company is now buying BTC below its average cost basis.
  • Strategy is yet to reveal last week’s fundraising, but some of the sales came from STRC preferred stock.

Strategy announced its weekly BTC acquisition a day late. The company managed to raise funds for more than the expected weekly purchase, adding 2,486 BTC to its treasury. 

Strategy acquired another 2,486 BTC, announcing the purchase a day late, coinciding with the US President’s Day. The purchase also coincided with a slower week on the crypto market during the Lunar New Year celebrations. This is the biggest weekly treasury addition for the past three weeks.

The new batch of purchases was at an average price of $67,710, as Strategy now buys BTC below its average purchase value of $76,027. The slightly larger purchase arrives after Strategy added 1,142 BTC in the week of February 10.

Despite the market’s muted reaction to Saylor’s messaging, a skipped week would raise more questions about Strategy’s ability to raise funds. The latest purchase arrives after a series of reassurances that the company’s playbook can survive a crypto winter. 

Strategy still relies on STRC

The latest BTC purchase arrives after a week of successful raises through the STRC preferred stock. 

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This time, the bank holiday prevented Strategy from filing its usual 8-K form, outlining the methods of raising funds. In the past week, Strategy managed to sell STRC as prices moved above $100, boosting its ability to buy more BTC. 

The previous week, Strategy acquired BTC by still using its MSTR common stock ATM facility, while waiting for a STRC selling chance. The company expanded the information on STRC with a recent short tear sheet on the preferred stock. 

Following the latest purchase, MSTR hovered at $128.62, while BTC traded at $67,324.22. Following Strategy’s announcement, BTC once again dipped to the $66,000 range.

Strategy remains the only treasury company to keep up the pace of regular purchases, based on its playbook. Other companies only add sporadic purchases, with the smallest treasury currently standing at 125 BTC.

Can Strategy continue with its purchases?

Strategy has the ability to continue with weekly purchases, mostly by offering a significant interest of 11.25% on its STRC preferred stock. MSTR dilution is the other option, despite the common stock’s unfavorable price. 

The company faces the challenge of surviving a bear market while using its reserves to pay dividends and to cover its maturing debt in 2028. 

STRC sales depend on the days when the preferred stock trades above $100, signaling buyer interest. In the new week, no new sales have been completed. STRC fell back to $99.80, awaiting a breakout before more sales are viable. 

See also  BitGo seeks nearly $2 billion valuation in stock sale

Strategy sits on an unrealized loss of $5.7B, only based on its BTC position. The loss is smaller than BitMine’s cut on Ethereum, reaching $7.9B after the recent price dip.

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Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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