Key Takeaways
- • Strategy, formerly MicroStrategy, bought $2.46 billion of Bitcoin in the week of July 28 to Aug. 3, its third-largest purchase by dollar value since it began accumulating the cryptocurrency five years ago, according to an SEC filing disclosed Monday.
- • The company acquired 21,021 BTC at an average price of $117,526 per token, its second-highest average purchase price ever, bringing total holdings to 628,791 Bitcoin worth more than $71 billion at current prices.
- • Purchases were funded through a mix of common and preferred share sales and debt, with the preferred stock offering dubbed Stretch launched in late July.
- • Saylor pledged not to issue new common shares below 2.5 times net asset value, except to cover debt interest or preferred dividends, following criticism from short seller Jim Chanos.
- • Strategy reported a $14 billion unrealized gain in Q2, driven by Bitcoin's price rebound and an accounting change requiring revaluation of its holdings.
Summary
Strategy, formerly known as MicroStrategy Inc., disclosed Monday in a U.S. Securities and Exchange Commission filing that it bought $2.46 billion of Bitcoin in the past week, its third-largest purchase by dollar value since it began accumulating the cryptocurrency five years ago. The company acquired 21,021 tokens between July 28 and Aug. 3, pushing total holdings to 628,791 Bitcoin, which Fortune reports is worth more than $71 billion at current prices.
The latest acquisition came at an average price of $117,526 per token, according to company data, the second-highest average price Strategy has ever paid, just behind the $118,940 average recorded last month. The purchases were made as Bitcoin trades near record levels. Strategy is by far the largest corporate holder of Bitcoin, according to a tally by BitcoinTreasuries.net, and its model has spawned a wave of public companies pursuing similar treasury strategies.
Saylor has funded the purchases through a combination of common and preferred share sales and debt. The company currently offers four types of securities to investors and launched its latest preferred stock offering, dubbed Stretch, in late July. Strategy reported an unrealized gain of $14 billion in the second quarter, driven by a rebound in Bitcoin's price and a recent accounting change that required the company to revalue its Bitcoin holdings.
Saylor recently pledged that the company will not issue new common shares at less than 2.5 times its net asset value, except to cover debt interest or preferred dividends. The commitment followed criticism from Jim Chanos, who has questioned the premium Strategy's Bitcoin holdings place on its share price and the number of securities offerings the company uses.
Strategy's stock has risen more than 3,000% since its first crypto purchase, outpacing Bitcoin as well as the S&P 500 and Nasdaq 100. Its first and second largest purchases came in November of last year, totaling $5.4 billion and $4.6 billion, according to company data.
The latest acquisition came at an average price of $117,526 per token, according to company data, the second-highest average price Strategy has ever paid, just behind the $118,940 average recorded last month. The purchases were made as Bitcoin trades near record levels. Strategy is by far the largest corporate holder of Bitcoin, according to a tally by BitcoinTreasuries.net, and its model has spawned a wave of public companies pursuing similar treasury strategies.
Saylor has funded the purchases through a combination of common and preferred share sales and debt. The company currently offers four types of securities to investors and launched its latest preferred stock offering, dubbed Stretch, in late July. Strategy reported an unrealized gain of $14 billion in the second quarter, driven by a rebound in Bitcoin's price and a recent accounting change that required the company to revalue its Bitcoin holdings.
Saylor recently pledged that the company will not issue new common shares at less than 2.5 times its net asset value, except to cover debt interest or preferred dividends. The commitment followed criticism from Jim Chanos, who has questioned the premium Strategy's Bitcoin holdings place on its share price and the number of securities offerings the company uses.
Strategy's stock has risen more than 3,000% since its first crypto purchase, outpacing Bitcoin as well as the S&P 500 and Nasdaq 100. Its first and second largest purchases came in November of last year, totaling $5.4 billion and $4.6 billion, according to company data.
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