Strategy Shares Rise on $43 Million Purchase—Its Largest in Four Weeks

In brief

Strategy purchased $43 million worth of Bitcoin.
The purchase was funded through a combination of preferred shares.
Citi analysts last week said Strategy shares could hit $485.

Strategy spent $43 million on 390 Bitcoin last week, the company said in a press release on Monday, its largest purchase of the asset in nearly a month.

The Tysons Corner, Virginia-based firm now owns roughly 640,800 Bitcoin. The stockpile was recently worth $73.6 billion, as Bitcoin changed hands around $114,800 on Monday, according to crypto markets data provider CoinGecko.

Not long after markets opened, Strategy shares rose 1.9% to $294, according to Yahoo Finance. The company’s stock price had still fallen 4.8% from $314 over the past month.

Strategy’s latest Bitcoin purchase was funded with proceeds from the issuance of preferred shares. The disclosure came as Bitcoin hovered near a two-week high, with easing geopolitical tensions between the U.S. and China benefiting risk assets in recent days.

In a Myriad market, more than 71% of the respondents agreed with the crypto trader Mando who predicts that BTC will regain $120,000 instead of falling to $100,000 as the crypto entrepreneur KBM forecast. (Myriad is a unit of Dastan, the parent company of an editorially independent Decrypt)

Although Strategy has historically issued common shares at a premium relative to its Bitcoin holdings to grow its stockpile, the company has taken a different approach to raising capital in recent weeks, while leaving its primary source of funding untapped.

The world’s largest corporate holder of Bitcoin hasn’t issued common shares since around Sept. 29, when it unveiled a $22 million Bitcoin purchase. At the time, Strategy said that it had raised $128 million, leaving it with extra cash on hand as dividend payments approached.

Strategy has unveiled several types of preferred shares this year as a way to fund its Bitcoin purchases, and some of those products entail quarterly dividend payments.

As Strategy stopped issuing common shares, its Bitcoin purchases had gotten relatively smaller, totalling 196 Bitcoin, 219, Bitcoin, and 390 Bitcoin. They were among some of the smallest Bitcoin purchases that Strategy has disclosed this year.

“It’s Orange Dot Day,” Strategy co-founder and Executive Chairman Michael Saylor said on X on Sunday, while displaying a chart of the company’s previous Bitcoin purchases.

Last week, Citi analysts described Strategy as “a bellwether of BTC’s potential upside and downside momentum,” while giving the company’s stock a price target of $485 per share. Still, it warned that a drop in Bitcoin’s price could lead to magnified losses for Strategy shareholders.

In the note, Citi analysts said the premium that Strategy trades at relative to its Bitcoin holdings could persist if Bitcoin maintains positive momentum. Over the past month, that premium had shrunk to 1.16x on Monday from 1.25x, according to Bitcoin Treasuries.