Strategy Makes Its Largest Bitcoin Purchase Since July
Strategy bought 13,627 BTC for $1.25B, extending its buying streak to a third consecutive week.
Strategy has completed its largest bitcoin purchase since July, increasing its holdings for the third week in a row. Over the past week, the company acquired 13,627 bitcoins for a total of $1.25 billion.
The purchase was financed through the sale of common shares and perpetual preferred shares issued under the ticker STRC. The average price paid per bitcoin in this transaction was approximately $91,519.
Strategy is currently the world’s largest publicly listed holder of bitcoin. The company’s investment strategy is overseen by its executive chairman, Michael Saylor. Following the latest acquisition, Strategy now holds a total of 687,410 bitcoins, purchased for a combined $51.80 billion. The average purchase price across its entire portfolio stands at $75,353 per bitcoin.
The announcement came at a time when bitcoin was trading around the $90,000 level. Before the start of regular stock market trading, Strategy’s shares were quoted slightly higher.
A Risky Model for Financing Bitcoin Purchases
Strategy finances its bitcoin acquisitions primarily through borrowing and the issuance of new shares, which in practice leads to the dilution of existing shareholders’ stakes. This approach carries significant risk, as it tightly links the company’s financial stability to the price of bitcoin.
If bitcoin were to experience a sharp and prolonged decline, the value of the collateral backing the company’s obligations could prove insufficient, making debt servicing more difficult or even impossible. In an extreme scenario, Strategy could be forced to sell part of its bitcoin holdings to meet its liabilities. Such a sell-off could put downward pressure on the market and trigger a domino effect, where falling BTC prices compel other market participants to sell, further deepening the downturn.
