Strategy's STRK Drops 1.9% as Firm Plans $21B Preferred Stock Sale for Bitcoin Buying

Strategy, the software intelligence firm, is planning to sell up to $21 billion in preferred stock to fund its Bitcoin purchases. This move comes as the firm's Bitcoin buying spree has slowed down. The company, formerly known as MicroStrategy, has been a significant player in the Bitcoin market, holding a substantial amount of the cryptocurrency. Despite the recent market volatility, Strategy remains profitable on its Bitcoin holdings, with a profit of approximately $7.8 billion.

The firm has entered into a sales agreement with a dozen financial institutions to issue its “STRK” offering. This preferred stock features an 8% cumulative dividend that’s payable in either cash or Class A shares. The company initially introduced STRK in January, targeting a $2 billion capital raise. However, the latest filing indicates that the firm can make no assurances as to when the sale of its preferred stock will take place, or if it will be able to sell $21 billion worth of preferred shares.

Strategy's decision to sell preferred stock is part of its strategy to accelerate its Bitcoin acquisitions. The firm has been actively buying Bitcoin, and this latest move indicates its continued commitment to the cryptocurrency. The sale of preferred stock will provide the necessary capital to continue purchasing Bitcoin, even as the market experiences fluctuations. The company last bought Bitcoin on Feb. 24, scooping up $1.9 billion worth of the asset for an average price of $97,500.

Strategy's Bitcoin holdings have been a topic of interest for investors and analysts alike. The firm's aggressive buying strategy has made it one of the largest corporate holders of Bitcoin. Despite the recent slowdown in purchases, the company's profit from its Bitcoin investments remains significant. This indicates that Strategy's strategy of holding Bitcoin as a long-term investment has been successful so far.

The sale of preferred stock is a strategic move by Strategy to ensure it has the financial resources to continue its Bitcoin buying spree. The firm's commitment to Bitcoin is evident in its decision to sell preferred stock, which will provide the necessary capital to continue purchasing the cryptocurrency. This move is part of Strategy's long-term strategy to hold Bitcoin as a store of value and a hedge against inflation. The company plans to raise $42 billion through equity and fixed income sales over the next three years to purchase more Bitcoin than it could otherwise.

As crypto prices have been battered over the past few