Strategy is selling bitcoin again: STRC buyback and a new round of dollar reserves
From August 3 to 9, the company sold 1,690 BTC for approximately $108.6 million. The average sale price was $64,262 per coin. This transaction, disclosed in an 8-K filing with the U.S. Securities and Exchange Commission (SEC), is notable because it occurs against a backdrop of market prices that remain below the company's average cost basis for its bitcoin holdings.
Transaction details and current position
After this sale, Strategy retains 840,447 BTC on its balance sheet—still the largest corporate reserve of the leading cryptocurrency in the world. However, the key point is that the company is selling coins below their cost basis, recording a loss relative to the average acquisition price of $75,385. The entire current inventory is valued at $63.36 billion.
The proceeds were used to repurchase 1,152,020 STRC preferred shares. This perpetual floating-rate security, issued to fund bitcoin investments, carries a 12% annual dividend. The price support mechanism, however, has not yet delivered the expected effect: on Friday, STRC closed at $95.01 (+1.16% for the day), still below the $100 par value, and over the past year the security has fallen to a low of $71.25.
Notably, this is the second consecutive week that Strategy has been a net seller of bitcoin. The previous week, the company sold 1,638 BTC, and no new purchases are reported in the latest filing. This continues a trend that began after the approval of the Digital Credit Capital Framework plan in late June. Under this plan, the company is permitted limited BTC sales to fund dividends, buybacks, and cash reserve replenishment when issuing new shares appears less favorable.
Dollar reserve and MSTR shares
In addition to selling bitcoin, Strategy also sold 6,585,682 common MSTR shares under its at-the-market (ATM) program, raising $653.1 million and directing $650 million into its dollar reserve, which now stands at $4.65 billion. As explained by the company's executive chairman, Michael Saylor, this is not a departure from bitcoin but a credit operation: increasing the dollar reserve extends the "duration" of the USD reserve by 143 days—to 2.7 years—and reduces the bitcoin-backed STRC credit by 10 basis points.
MSTR shares closed Friday at $100.01, up 3.26%. However, in Monday's premarket, the stock slipped slightly by 0.21%. The limit on issuing new MSTR shares is barely touched—about $22 billion remains—while the quota for redeeming preferred shares is nearly exhausted: only $785.2 million is available.
Measures to restore the STRC price have partially worked: the security has recovered approximately 33% from its lows. But even the 12% dividend and $109 million in buybacks have not yet brought the price to par. The market remains skeptical of this structure.
Bitcoin is trading around $65,019 on Monday, up 1.5% over 24 hours. Meanwhile, the market is still roughly 13% below Strategy's average purchase price.
My view: The company's strategy is turning into complex financial engineering, where the bitcoin proxy now operates as a treasury with active management in the interests of its own capital structure. The question is how long the market will accept this construct, especially if the BTC price continues to remain below the cost basis of the holdings. Investors should closely monitor whether the current pace of sales persists or whether the company returns to accumulation.