Strategy, the largest corporate holder of Bitcoin, added $300 million to its US dollar reserve and acquired 520 BTC, according to a recent SEC filing. The purchases were funded through its ATM equity program, which raised $335.5 million from sales of Class A common stock (MSTR).
Funding and Reserve Allocation
The company allocated $34.9 million of the proceeds to buy 520 Bitcoin, while $300 million was placed into its USD Reserve. This reserve is designed to support dividend payments and debt obligations. Strategy stated it plans to continue replenishing the reserve over time based on market conditions to maintain the credit quality of its Digital Credit securities.
Market Performance and Volatility
Strategy's shares and preferred stock have seen notable volatility. MSTR closed at $112.53 on Thursday, down 3.46%, while STRC, the perpetual preferred stock, fell 0.46% to $88.59. STRC is designed to trade near $100 but dropped below $90 last week. During Monday's premarket session, STRC traded at $90.59.
Self-Repairing Mechanism
Bitcoin advocate Samson Mow commented on X that STRC has a 'self-repairing mechanism' that activates when the security trades below its $100 reference level. He explained that when the price falls below that threshold, the company stops issuing new shares through its ATM program, limiting new supply. Lower prices also increase the yield for buyers relative to their purchase price, potentially encouraging demand and pushing the price back toward $100. Mow described this as relying on market incentives rather than active intervention.