Bitcoin News Today: MSTR's Bitcoin Bet: Can Preferred Financing Outpace Market Volatility?

Strategy Inc. (MSTR) has announced plans to issue 3.5 million shares of its 10.00% Series A Perpetual Stream Preferred Stock (STRE), denominated in euros, as part of a capital-raising initiative. The offering, which will see the stock accumulate cumulative dividends at a 10% annual rate on a €100-per-share stated value, is expected to bolster the company's balance sheet and fund further investments in bitcoin and other corporate activities, according to Strategy's IPO announcement. The STRE shares will pay quarterly dividends in arrears, with the first payment due on December 31, 2025, the announcement said.

The move aligns with Strategy's broader strategy to leverage preferred financing for growth, as highlighted in its Q3 2025 earnings report, where the company reiterated its FY2025 guidance of $24 billion in net income and $80 in diluted earnings per share (EPS), assuming a year-end bitcoin price of $150,000. Recent transactions underscore this approach: In the week ending November 2, 2025, Strategy purchased 397 bitcoins for $45.6 million, averaging $114,771 per unit, despite bitcoin trading at $107,946.60 pre-market. These purchases, funded by proceeds from common and preferred stock offerings, have expanded Strategy's bitcoin holdings to 641,205 units, acquired at an aggregate cost of $4.75 billion.

The STRE issuance follows a successful $2.5 billion raise in July 2025 via its Variable Rate Series A Perpetual Stretch Preferred Stock (STRC), which featured variable dividend rates ranging from 9% to 10.5% annually, according to the company's Q3 report. Strategy's preference for perpetual preferred stock reflects its focus on minimizing dilution while securing long-term capital. "Preferred financing allows us to maintain control while scaling our bitcoin-backed credit expansion," a company representative stated in a recent earnings call.

Market reaction has been mixed. While Strategy's shares rose over 4% in extended trading following the STRE announcement, its stock fell 2.04% in pre-market sessions amid broader market volatility. Analysts note that the company's financial performance remains highly sensitive to bitcoin price fluctuations, as its holdings are marked to market under ASU 2023-08, amplifying earnings volatility.