Strategy Buys Another $100M in Bitcoin as BTC Trades Below Cost Basis

Strategy (formerly MicroStrategy) added 1,587 Bitcoin (BTC) worth about US$100 million (AU$141 million) last week, lifting its total holdings to 846,842 BTC even as the cryptocurrency traded below the company’s average purchase price, according to a securities filing.

The coins were bought between June 8 and 15 at an average of about US$63,024 (AU$88,860) each, well under the firm’s blended cost basis of roughly US$75,656 (AU$106,700) per Bitcoin built up across years of purchases. 

With Bitcoin trading near US$66,216 (AU$93,365), the position remains underwater on a mark-to-market basis, with the holdings’ value sitting several billion dollars below their cumulative purchase cost of around US$64 billion (AU$90.3 billion).

Related: Ripple’s Garlinghouse Calls Out Jamie Dimon Over Crypto Clarity Act Criticism 

Stock Sales Fund the Buy

Strategy financed the acquisition by selling MSTR Class A common stock rather than tapping its preferred-share programs. The company sold roughly 1.73 million shares to raise about US$209 million (AU$295 million) — more than twice what it spent on Bitcoin over the same period.

That imbalance has drawn scrutiny, as the firm continues to issue equity at a faster pace than it converts the proceeds into Bitcoin, directing the remainder toward liquidity and its dividend-paying securities.

The purchase came just two weeks after Strategy sold Bitcoin for the first time in years, offloading about 32 BTC on June 1 in a move chairman Michael Saylor defended as necessary to support the company’s income-paying securities programs.

“Still adding dots,” Saylor posted on June 15, referencing the company’s running chart of purchases. With Bitcoin down sharply from its highs, the firm’s average cost now sits above the market price, a reversal from the deep unrealised gains it carried through much of the prior rally.

Read more: Financial Advisors Pivot Beyond Bitcoin as Stablecoins and Tokenisation Take Center Stage

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