Strategy Eyes $21B Bitcoin Buy With Preferred Stock Offering

Strategy, formerly MicroStrategy, is gearing up to significantly add to its already outsized Bitcoin stash. On Monday, March 10, Strategy disclosed that it had entered a sales agreement to raise $21 billion by selling 8% of its series A perpetual strike preferred stock STRK. The firm disclosed that the proceeds will be used for general corporate purposes, including buying Bitcoin and for working capital, likely itemized in order of priority judging by the company's precedents. https://twitter.com/saylor/status/1899068491409260639 Still, the firm noted that the sale of these preferred stocks will occur over a long period, not all at once. The strike preferred stock, which offers investors regular dividend payments, is one of the most recent capital market tools Strategy has employed to raise capital for Bitcoin purchases. In addition to this strike preferred stock offering, the firm also regularly offers convertible senior notes, which investors can convert to shares in the firm or cash on maturity. The recently announced $21 billion offering is likely part of Strategy's "21/21" plan, which seeks to raise $42 billion through 2027 to acquire more Bitcoin. At the time, the firm disclosed that it intended to raise $21 billion from equity sales and $21 billion from fixed-income securities, including preferred stocks. Since announcing this "21/21" plan in October 2024, Strategy has unveiled fresh Bitcoin purchases almost weekly but has been uncharacteristically quiet in the past two. At the time of writing, the firm holds 499,096 BTC worth $40.7 billion, purchased at an average price of $66,380.42. These holdings are 22.86% (roughly $7.6 billion) in profit as Bitcoin trades near three-month lows below $82,000. Following recent precedent, it won't be surprising to see Strategy announce fresh Bitcoin purchases by Monday, March 17.