Strategy sells another 1,690 BTC, closing the last $5 gap toward STRC's face value
- Key Takeaways: Strategy has driven STRC preferred stock's price from $74 back to $95, approaching its $100 face value, through large-scale buybacks ($214.8 million deployed over three weeks) and BTC sales to raise capital. Meanwhile, the company has pushed its dollar cash reserves to a record $4.65 billion through share issuance, strengthening its capital structure safety cushion.
- Key Elements:
- Repurchased approximately 2.3 million STRC shares over three weeks, totaling $214.8 million; the largest single purchase was 1.1 million shares for $108.6 million in the week ending August 9, leaving $785.2 million in remaining buyback authorization.
- To fund the buybacks, sold 3,328 BTC over two weeks (recovering approximately $213.3 million), reducing holdings from 842,000 to 840,400 BTC—still the largest corporate Bitcoin holder globally.
- During the same period, issued 6.5 million shares of MSTR common stock via its ATM program, raising $653.1 million, which pushed dollar reserves to a record $4.65 billion—enough to cover approximately 2.7 years of preferred stock dividends and debt interest.
- STRC currently trades around $95, just $5 below its $100 face value; based on the pace of returning to face value within 70 trading days mentioned in Q2 earnings, the target price could be reached around September 8.
- If STRC fails to close the gap on its own, Strategy can still deploy its $785.2 million buyback authorization to support the price, but the market's focus remains on the additional capital required for support and whether further BTC sales will follow.
Original Author: Oluwapelumi Adejumo
Original Translation: Chopper, Foresight News
As bitcoin treasury company Strategy continues to repurchase its preferred stock, the STRC price is steadily recovering toward its $100 target.
STRC.live data shows that STRC traded around $95 on Monday, continuing its rebound from a low of $74 at the end of June. Strategy has been narrowing the discount on STRC through direct share repurchases in the secondary market on one hand, and by offering a 12% annualized dividend yield on the other.
Over the past three weeks, Strategy has purchased approximately 2.3 million shares of STRC, with a total value of around $214.8 million. The latest round — and the largest repurchase to date — took place during the week ending August 9, when the company spent $108.6 million to buy 1.1 million shares. The previous two rounds involved investments of $25 million and $81.2 million, respectively.
Under the $1 billion digital credit securities repurchase program approved in June, Strategy currently has approximately $785.2 million in remaining capacity.
Strategy's STRC preferred stock price has rebounded after the company repurchased approximately $214.8 million worth of shares over three weeks
Selling Bitcoin to Fund STRC Buybacks
In recent weeks, Strategy has increasingly tapped its bitcoin inventory to raise funds for STRC repurchases. During the week ending August 9, Strategy sold 1,690 bitcoins at an average price of $64,262, generating $108.6 million in proceeds.
The company executed the same move a week earlier, selling 1,638 bitcoins to raise $104.7 million. Of that amount, $52.3 million was used for the $81.2 million STRC buyback, with the remaining funds coming from the issuance of additional MSTR common shares.
Within two weeks, Strategy sold a combined 3,328 bitcoins, recouping approximately $213.3 million in capital. During the same period, it deployed $189.8 million to repurchase STRC shares.
Following this round of sales, Strategy's bitcoin holdings declined from 842,138 coins a week earlier to 840,447 coins. The company's total bitcoin holdings now carry an aggregate cost basis of $63.36 billion, with an average acquisition price of $75,385 per coin.
After four consecutive weeks of reductions, Strategy has sold a cumulative 6,948 bitcoins this year, with holdings continuing to slide from their June peak of 847,363 coins. Nevertheless, relative to its massive bitcoin inventory, the scale of these reductions remains limited, and Strategy remains the largest corporate holder of bitcoin globally.
Strategy's bitcoin holdings have declined for four consecutive weeks
The series of transactions demonstrates that bitcoin is being assigned a broader role under Strategy's digital credit capital framework. The company can opportunistically liquidate portions of its holdings to support preferred stock and other debt within its capital structure.
USD Cash Reserves Hit Record High of $4.65 Billion
During the same week, Strategy accelerated the expansion of its cash reserves, raising an additional $653.1 million through the issuance of common shares.
The company sold 6.5 million shares of MSTR common stock through its at-the-market (ATM) offering program, with $650 million directed into its dollar reserve account and the remaining $3.1 million allocated to its general cash account.
This move pushed the company's dollar reserves from $4 billion a week earlier to a record high of $4.65 billion. These reserves provide a liquidity buffer for STRc preferred stock dividends and debt interest payments, effectively strengthening the safety cushion amid continued expansion of the capital structure and rising fixed costs.
Strategy CEO Phong Le noted that dollar reserves have grown rapidly since the new capital management framework was implemented at the end of June. He wrote: "Our dollar reserves and duration have both reached all-time highs. In just two and a half months, reserves have grown by nearly $3.8 billion, with both metrics expanding more than 5x. This is the result of the digital credit capital framework coming to fruition."
Strategy's cash reserves
Executive Chairman Michael Saylor stated that this capital injection extended the dollar reserve duration by another 143 days, bringing total duration to approximately 2.7 years. The dollar holdings currently on hand are sufficient to cover preferred stock dividend and debt interest payments for nearly the next three years, significantly alleviating short-term solvency pressure.
Strategy's MSTR ATM offering program still has approximately $2.2 billion in available capacity. Additionally, a $1 billion common stock repurchase authorization remains unused and has yet to be activated.
The ample cash reserves give Strategy greater operational flexibility, allowing it to meet dividend and debt obligations without relying on external financing.
STRC's Final $5 Gap Will Determine Its Path Forward
With STRC currently sitting just about $5 below its $100 par value, the key test ahead is whether the stock can close the gap on its own without Strategy's support. The company has previously cautioned that STRC's return to par value would take time.
During its Q2 earnings call, the company noted that following STRC's listing in 2025, it took approximately 70 trading days to stabilize at $100. Based on a similar trajectory, this rebound could see the stock return to par value around September 8.
However, the market environment this time is different, as Strategy is actively providing support through a dual approach of adjusting its dividend policy and conducting direct secondary market buybacks.
Once the price returns to the $100 par value, the company will no longer need to sustain large-scale buybacks, and STRC can better fulfill its role as a financing tool. Issuing new shares at prices close to par value can significantly improve financing efficiency compared to periods of prolonged discounted trading.
Should STRC's upward momentum prove insufficient and the stock continues to hover below the $100 par value, Strategy still holds $785.2 million in buyback capacity and can step in to support the market at any time.
As long as STRC remains significantly below its target price, Strategy will intervene decisively. But the biggest question for the market right now is how much capital the company will need to deploy to support the stock through its final few dollars of upside, and whether it will continue selling bitcoin to do so.
