Strategy Breaks 700K BTC Barrier; MSTR Slides on Dilution Concerns

Strategy (formerly MicroStrategy) has aggressively defended its treasury mandate, acquiring 22,305 BTC for approximately $2.13 billion between Jan. 12 and Jan. 19, according to a regulatory filing released Tuesday. The purchase, executed at an average price of $95,284 per bitcoin, pushes the firm’s total holdings to a record 709,715 BTC. Roughly 3.37% of the total Bitcoin supply.

The Cost of Accumulation

The Tysons Corner-based firm, led by Michael Saylor, now controls a Bitcoin stockpile valued at approximately $64.5 billion. The latest tranche was funded entirely through the company’s “at-the-market” (ATM) equity programs, raising $2.125 billion by selling class A common stock and preferred shares. This relentless issuance has raised the firm’s aggregate cost basis to $53.92 billion, or $75,979 per bitcoin.

Markets reacted negatively to the dilution. Strategy shares (MSTR) fell approximately 5% in pre-market trading, struggling to hold the $165 level, while Bitcoin hovered around $90,200.

Yield Compression & Analyst Downgrade

The sheer scale of equity issuance required to sustain these purchases is weighing on sentiment. TD Cowen analyst Lance Vitanza lowered his price target for Strategy to $440 (from $500), citing a deteriorating “BTC Yield” outlook. The metric, which tracks the ratio of Bitcoin holdings to outstanding shares, is being compressed as the company floods the market with new equity to fund acquisitions.

Strategy is still buying Bitcoin because stopping would be as much a signal to the market as purchasing more.

Despite the target cut, the accumulation signals unwavering institutional conviction. With BlackRock recently allocating $380 million to Strategy-linked preferred securities, the firm has effectively positioned itself as a high-beta Bitcoin instrument for capital markets, even as spot prices waver.