Strategy is selling bitcoin again: STRC buyback and a new round of treasury strategy
Strategy, formerly known as MicroStrategy, has once again resorted to selling part of its bitcoin reserve. This week, the corporation sold 1,690 BTC for $108.6 million, directing all proceeds to buy back its own preferred shares STRC. This is already the second such deal in the last two weeks, signaling a shift in capital management priorities.
According to my analysis of the filing submitted to the SEC, the sales were carried out between August 3 and 9 at an average price of $64,262 per coin. After this operation, Strategy's balance sheet holds 840,447 BTC—still the largest corporate stash of the leading cryptocurrency in the world. However, it is important to note: the company is selling coins below its average cost of $75,385, which effectively locks in a loss on these transactions.
Deal details and market reaction
The proceeds were used to buy back 1,152,020 preferred shares of STRC. Recall that this instrument, with a floating rate and current yield of 12% per annum, was issued to finance bitcoin investments, and its price should be supported near the par value of $100. However, the market did not embrace this structure: over the past year, the security fell to a low of $71.25, and only recently recovered about 33% from the bottom. On Friday, STRC closed at $95.01, showing modest growth of 1.16%.
In parallel, Strategy carried out the sale of 6.58 million common shares of MSTR through an ATM program, raising $653.1 million. Of these funds, $650 million were directed to the dollar reserve, which now stands at $4.65 billion. According to management, this increased the "duration" of the USD reserve by 143 days—to 2.7 years—and also reduced the bitcoin credit risk of STRC by 10 basis points.
Strategic pivot
All these actions fit within the framework of the Digital Credit Capital Framework plan approved in late June. It allows limited bitcoin sales to finance dividends and buybacks of preferred securities when issuing new shares becomes less advantageous. Since the launch of this program, Strategy has effectively paused BTC purchases and each week builds up fiat reserves, claiming they are sufficient for payouts several years ahead.
In my view, we are witnessing a fundamental transformation: from a pure bitcoin holder, the company is turning into an active treasury manager. However, the market has not yet appreciated this shift—common shares of MSTR closed on Friday at $100.01, and bitcoin itself is trading around $65,019, which is 13% below Strategy's average purchase price. Investors face a tough choice: whether to keep faith in the bitcoin proxy or acknowledge that this is now more of complex financial engineering, where the interests of holders of different share classes are increasingly diverging.