Strategy Plans To Raise $250 Million Via Preferred Stock Sales To Fuel Stunning Bitcoin Buying Spree

Bitcoin giant Strategy wants to raise fresh capital by selling shares of preferred stock, with the proceeds earmarked for additional Bitcoin purchases.

In a Monday filing with the Securities and Exchange Commission, the company said it intends to sell 2.5 million shares of its 10% Series A Stride Preferred Stock (STRD). The offering will be listed on the Nasdaq, with each share initially priced at $100, offering “institutional investors and select non-institutional investors” a 10% annual dividend yield.

“Strategy intends to use the net proceeds from the offering for general corporate purposes, including the acquisition of bitcoin and for working capital,” the company said in an official statement. 

The STRD offering marks Strategy’s third preferred stock issuance this year following its Strike (STRK) and Strife (STRF) offerings, in addition to its effort to raise $84 billion — a combination of both equity and debt — to fund future Bitcoin buys. STRK and STRF are convertible preferred stocks that offer a yield of 13% and 10%, respectively.

Strategy is currently the world’s largest corporate Bitcoin holder after accumulating 580,955 BTC, currently valued at over $61 billion at current market prices.

In the Monday announcement, Strategy also pointed out under what circumstances it can redeem the STRD shares.

“Strategy will have the right, at its election, to redeem all, but not less than all, of the STRD stock, at any time, for cash if the total number of shares of all STRD stock then outstanding is less than 25% of the total number of shares of STRD stock originally issued in the offering and in any future offering, taken together,” it stated.

Strategy’s plan of stockpiling Bitcoin has caused the company’s stock price to grow by more than double during the past year. As such, many publicly listed companies around the world have been mulling the possibility of becoming crypto treasury companies after witnessing the success of Strategy’s Bitcoin playbook. 

Bitcoin was recently changing hands around $106,613, a 2.4% increase over the past 24 hours, according to crypto data provider CoinGecko. Late last month, the top crypto climbed to an all-time high of almost $112,000 before erasing some of those gains.