Strategy disclosed that, for the week ending September 7, the company did not continue purchasing Bitcoin. Just one week prior, this Bitcoin treasury company had ended a two-month pause in its buying activity. The latest filings show that, during the same week, the company allocated $176.3 million to repurchase its preferred shares and simultaneously expanded its related repurchase authorization.
Buyback scale increases to $2 billion
The announcement states that the Strategy Board has increased the authorized size of the digital credit securities repurchase program from $1 billion to $2 billion. As of September 7, $1.19 billion of the program’s authorized amount remains available.
Meanwhile, the company’s other $1 billion share repurchase program targeting MSTR common stock has not yet been utilized.
Bitcoin holdings remain at 845,000 coins.
As of September 7, Strategy held 845,050 bitcoins and assets worth $6.5 billion. Based on the market data cited in the article, with bitcoin priced at approximately $77,760, the market value of this holding is around $65.7 billion, exceeding the cumulative purchase cost of approximately $63.7 billion, resulting in an unrealized profit of about 3%.
However, the bitcoins purchased by the company when it resumed buying last week had an average purchase price of approximately $80,318 per coin, and are still at a paper loss at current prices.
Cash pool usage shifted to buybacks
The current U.S. dollar reserves are divided into two parts: $5.1 billion in USD Reserve, primarily used to pay preferred dividends and interest, and $1.44 billion in USD Cash, which management may use to purchase Bitcoin or for other purposes.
The $176.3 million in preferred stock repurchase funds came from the latter. The company raised $2 billion in August by selling its MSTR shares, using the proceeds to build up this USD cash balance. Subsequently, the company used approximately $370 million of it to purchase Bitcoin, marking its first resumption of增持 since June.
However, in the most recent week, the company did not increase its position; instead, it redirected part of its funds toward capital structure adjustment.
MSCI index eligibility is still pending results.
In addition to funding arrangements, Strategy Chairman Michael Saylor and CEO Phong Le last week also requested that MSCI withdraw a rule they believe is discriminatory and could lead to Strategy being removed from the MSCI Global Index.
According to disclosures, funds tracking the relevant index currently hold approximately 3.1% of Strategy’s outstanding shares. MSCI’s public consultation on this matter will conclude at the end of September, with the final decision expected to be announced on October 16.
Additional information: This document is signed by Thomas C. Chow, General Counsel of Strategy.