Strategy redeemed 1,420,467 shares of STRC preferred stock for $139.3 million in the week ending September 13. This action followed a previous redemption of $176.3 million, which was due to the doubling of the digital bond buyback program authorization to $2 billion. All of this amount has been sourced from the company's cash reserves in US dollars, which are used for buybacks, dividends, and Bitcoin purchases.
Bitcoin Holdings Status
During this period, Strategy made no purchases or sales of Bitcoin, and their holdings remained stable at 845,050 BTC for the second consecutive week. The company has acquired this holding for $63.73 billion at an average price of $75,412 per coin, including related costs.
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Strategy has not redeemed any shares of STRF, STRK, or STRD, nor has it purchased any public MSTR shares. Currently, about $1.05 billion remains under the $2 billion digital bond program, while a separate $1 billion authorization for MSTR shares remains unused.
Financial Status Analysis
The company's dollar reserves reached $5.10 billion in US dollar cash by September 13, which is used to cover preferred dividend costs and interest payments. Additionally, there is $1.30 billion in US dollar liquidity, down from $1.44 billion last week. This decrease is roughly proportional to the $139.3 million spent on the STRC share buyback.
According to Strategy's credit dashboard, the credit spread of STRC Bitcoin, which indicates the price risk of these securities relative to Strategy's Bitcoin collateral, is around 57 basis points. This figure represents the additional cost or risk associated with this investment compared to safer investments. Strategy has a rule that whenever this risk remains below 150 basis points (1.5%), it considers this investment very safe and within the high credit investment range.
The required yield to cover Strategy's costs is estimated at 2.48%, meaning the minimum growth of Bitcoin needed to cover the company's annual expenses. The estimated time to reach this goal is 40.3 years, giving the company room to manage short-term price volatility.
Currently, the market is awaiting the outcome of a proposal from MSCI, which could remove companies like Strategy from global stock indices. This consultation continues until September 30, and the final decision will be announced by October 16, a date that could impact billions of dollars in passive investment flows.
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