Strategy, recognized as the largest corporate holder of Bitcoin globally, recently paused its Bitcoin acquisition activities for the first time since July, amidst announcing a substantial $140 million in dividend payments. This decision comes shortly after two previous similar pauses at the end of the first and second quarters of the fiscal year.
Based in Tysons Corner, Virginia, Strategy currently holds an impressive 640,000 Bitcoin, which is valued at approximately $80 billion given the cryptocurrency’s price near all-time highs. This year, the company has been innovative in its financial strategies, introducing various types of preferred shares to secure funding outside of traditional convertible debt and common shares. Among the five issued types, three feature a robust 10% annualized percentage yield (APY).
In a recent filing with the Securities and Exchange Commission, Strategy indicated that dividend payments on its preferred shares, specifically the STRC and STRD types, included accrued interest totaling $22.4 million and $37.6 million for the quarter, respectively. The firm’s shares experienced a positive response, rising 2.8% to $361 on Monday. Over the year, the stock has rallied by 25%, peaking at $450 in July.
For the third quarter, Strategy reported a remarkable $3.9 billion gain in the fair value of its Bitcoin holdings, signaling robust performance even amid the pause in acquisitions. Notably, Strategy has issued three updates this calendar year regarding its lack of Bitcoin purchases, all coinciding with the ends of each fiscal quarter.
Adding to the intrigue, co-founder and Executive Chairman Michael Saylor hinted at the company’s decision through social media. On X, he shared a chart depicting previous Bitcoin purchases, indicating “no new orange dots this week.” This cryptic message was interpreted by traders on the prediction market Polymarket, where the likelihood of a Bitcoin purchase announcement dramatically fell from over 60% to just 1% following Saylor’s post.
Saylor alluded to a “$9 billion reminder of why we HODL,” referencing the popular crypto slang for holding assets rather than selling. There has been some discussion regarding the exact meaning of this statement, with Blockstream co-founder Adam Back suggesting it could point to the unrealized gains in the value of Strategy’s Bitcoin holdings which had previously been disclosed at $14 billion for the second quarter.
The company’s strategic approach continues to draw significant attention from market watchers as it navigates the complexities of the cryptocurrency landscape.
