Strategy Raises $4.2 Billion for Bitcoin Purchases, Pauses Buying

Strategy, the company formerly known as MicroStrategy, has announced a significant fundraising initiative, raising $4.2 billion through the issuance of 10% perpetual preferred STRD shares. This move is part of the company's broader strategy to strengthen its position in the bitcoin market, under the leadership of Michael Saylor. The funds raised will be used primarily for bitcoin purchases, as well as to support general corporate needs and dividend payments.

This fundraising effort is conducted through an "At The Market" (ATM) program, which allows for the progressive sale of securities based on market conditions. The company plans to sell the STRD preferred shares gradually, taking into account market prices and liquidity at the time of each transaction. This approach provides Strategy with the flexibility to manage its raises by adjusting volumes according to market conditions, complementing ongoing programs such as the sale of MSTR common stock and other series of preferred shares.

Despite this significant fundraising, Strategy has paused its bitcoin purchases between June 30 and July 6. This pause marks the first interruption in the company's sustained bitcoin acquisition pace since the period from March 31 to April 6. The company currently holds 597,325 bitcoins, valued at over $65 billion at current prices, with an average acquisition cost of $70,982 per bitcoin, totaling approximately $42.4 billion, including fees.

The pause in bitcoin purchases can be interpreted in several ways. It may signal a strategic decision to wait for better market conditions or to finalize new raises. Alternatively, it could indicate prudent cash flow management in response to mixed financial publications. Regardless, the launch of the STRD program demonstrates Strategy's commitment to its long-term bitcoin-centered strategy, adapting its financing tools to the current economic and regulatory context.

Strategy's financial results for the second quarter show an unrealized gain of $14.05 billion on its cryptocurrencies, offset by a deferred tax expense of $4.04 billion. During the quarter, the firm raised a net total of $6.8 billion through sales of its MSTR common shares and STRK and STRF preferred shares. This fundraising is part of the "42/42 Plan," which aims to raise $84 billion by 2027, doubling the initially named "21/21" plan.

In summary, Strategy's $4.2 billion fundraising through the STRD program and the pause in bitcoin purchases reflect a strategic shift aimed at balancing liquidity seeking and financial optimization. This move underscores the company's commitment to its bitcoin strategy while adapting to current market conditions and regulatory environments. The "42/42 Plan" further solidifies Strategy's ambition to remain the largest institutional bitcoin holder, leveraging diverse financing instruments to achieve its goals.