In brief
- Strategy added 168 Bitcoin worth $18.8 million to its stockpile.
- That represented its third smallest Bitcoin purchase of the year.
- The company hasn’t issued any common shares this month.
Strategy notched its third smallest Bitcoin purchase of the year, disclosing that it had spent $18.8 million on 168 Bitcoin last week, according to a Monday press release.
The Bitcoin-buying firm's latest acquisition was funded with proceeds from preferred shares, leaving the Tysons Corner, Virginia-based firm with a stockpile of roughly 640,400 Bitcoin, which was recently worth $71 billion, based on current prices, according to CoinGecko.
Strategy shares rose 5.3% to $305, according to Yahoo Finance. Although the firm’s stock price has dropped 11.5% over the past month, its initial move on Monday lifted it into positive territory on the year, with shares up slightly from $300 in January.
Over the past seven days, Bitcoin’s price has fallen 3.4% to $111,250. In the press release, Strategy said that it paid an average cost of $112,000 per Bitcoin last week, despite Bitcoin's recent fall. (The digital asset showed signs of rebounding on Monday.)
More than nine in 10 respondents to a Myriad market believe that Strategy will not sell Bitcoin. (Myriad Markets is a product of DASTAN, the parent company of an editorially independent Decrypt.)
Historically, Strategy has issued common shares to fund its Bitcoin purchases. When its stock trades at a premium relative to its Bitcoin holdings, doing so allows Strategy to grow the amount of Bitcoin that it owns per share, while arbitraging the difference.
So far, Strategy hasn’t issued any common shares this month. Instead, the firm has tapped preferred shares introduced this year, which sometimes entail dividend payments.
In September, Strategy said that it bought 7,574 Bitcoin. So far this month, Strategy has purchased 387 Bitcoin, which is on pace for a 94% sequential decrease.
Strategy traded at a 1.21x premium to its Bitcoin holdings on Monday, according to Bitcoin Treasuries, which tracks mNAV, or multiple-to-net asset value. The metric has emerged as an informal yet popular standard for assessing Bitcoin treasury firms.
Strategy said earlier this year that it was adjusting its policy on common share issuance to convey discipline. The policy was modified to give the company greater flexibility, but onlookers suggested that it could make Strategy’s move less predictable moving forward.
Strategy has refrained from issuing common shares over the past few weeks, but the firm’s mNAV has still fallen from a 1.32x premium since late September, indicating that the funding mechanism has grown less lucrative, even as it's gone untapped.
“The most important orange dot is always the next,” Strategy co-founder and Executive Chairman Michael Saylor said on X on Sunday, referencing a chart that represents Strategy’s Bitcoin purchases with orange dots in varying sizes.