Strategy Raises $2B, Skips Bitcoin Buy, Builds $1.6B Cash Reserve

Strategy (formerly MicroStrategy) sold $2 billion worth of its own shares last week and parked the cash in a new dollar reserve instead of buying more bitcoin, per an SEC filing dated Aug. 24.

The 8-K puts the net raise at $2.01 billion: 18,261,118 MSTR shares sold at roughly $109.88 apiece. That is six times the $334 million raised the week before. None of it touched bitcoin (BTC).

It marks the second straight week the largest corporate holder of bitcoin bought nothing, even as the spot price pushed toward $80,000. Holdings stand at 840,447 BTC, or about 4% of the 21 million supply cap.

The cash went into two buckets. Strategy allocated $300 million to its existing USD Reserve, bringing that pool to $5.10 billion. The remaining $1.57 billion landed in a newly created “USD Cash” account, which stood at $1.59 billion as of Aug. 23, according to Decrypt.

The distinction between the two pools is the whole point. USD Reserve is ring-fenced for preferred dividends and interest on debt. USD Cash carries no such restriction. Strategy said the new pool is intended to let management move faster in response to market conditions, “including dislocations in the markets for bitcoin or Strategy’s securities.”

In practice, the company can put that $1.59 billion toward bitcoin, stock buybacks, convertible note redemptions, or a reserve top-up, all without waiting to raise fresh capital.

That flexibility complicates the narrative that Strategy buys bitcoin at every opportunity. The company has not purchased any since June, according to The Block. It has, in fact, been a net seller: 6,948 BTC disposed of for roughly $432.5 million since May.

A separate $136.4 million from last week’s raise went to repurchase STRC preferred stock, covering 1,431,212 shares. That leaves $516.6 million of the $1 billion buyback program announced June 29. A second $1 billion authorization for MSTR stock remains untouched.

The timing of the share sales was blunt. Strategy sold at an average of $109.88, up from $96.48 a week earlier. Six times the capital at a higher price, funneled into a pool that buys everything except the asset its identity was built on.

Cost basis on the bitcoin stack is $63.36 billion, an average of $75,385 per coin. At a spot price near $78,400, the position is worth about $65.9 billion, roughly $2.6 billion above cost. That is a sharp reversal from a week ago, when bitcoin traded at $63,553 and the stack sat $9.9 billion underwater. In July, near $58,000, the company was down about $13 billion on paper.

The Block values the holdings near $66 billion, consistent with Decrypt’s figure.

The company’s net debt ratio sat near zero as of Aug. 23, per the filing. Whether the $1.59 billion USD Cash pool gets spent on more bitcoin is, in the company’s own framing, conditional. It may be. It also may not.

Traders, as ever, disagree on what the pause signals.