Strategy Seeks $21 Billion to Boost Bitcoin Holdings!

Strategy Seeks $21 Billion to Boost Bitcoin Holdings!

Strategy, formerly known as MicroStrategy, has filed a prospectus with the Securities and Exchange Commission (SEC) outlining plans to raise up to $21 billion through the sale of its 8% Series A perpetual strike preferred stock, STRK.

The company intends to sell STRK shares through various methods, including at-the-market transactions, negotiated sales, or block trades. According to a statement released on Monday, the proceeds will be used for general corporate purposes, including acquiring additional bitcoin and supporting working capital needs.

The STRK shares carry a liquidation preference of $100 per share and will accrue cumulative dividends at a fixed annual rate of 8%. If declared by Strategy’s board of directors, these dividends will be paid quarterly.

This offering is part of the company’s broader “21/21 Plan,” which aims to raise a total of $42 billion through a combination of equity and fixed-income securities, primarily to fund bitcoin acquisitions. It follows Strategy’s initial perpetual preferred stock issuance.

As of its latest filing, Strategy holds 499,096 BTC, valued at over $41 billion. However, the company did not sell any Class A common stock under its ongoing at-the-market equity program to purchase additional bitcoin over the past week. The firm’s bitcoin holdings were acquired at an average price of $66,357 per BTC, with a total investment of approximately $33.1 billion, including associated fees and expenses.

Unlike traditional bonds, perpetual preferred stock has no maturity date or mandatory redemption timeline. Instead, it offers fixed dividend payments indefinitely, provided the issuing company remains operational. Holders of STRK shares have the option to convert them into Class A common stock under specific conditions. In such cases, any fractional shares may be settled in cash.

Additionally, Strategy retains the right to repurchase all outstanding STRK shares under certain circumstances—such as if the total value of the preferred stock falls below 25% of its original issuance amount or if certain tax-related events occur. The redemption price will be equal to the stock’s liquidation value plus any unpaid dividends and, in some cases, may be adjusted based on recent market prices.

In the event of a significant corporate change—referred to as a “fundamental change”—holders can require Strategy to buy back their shares at a price equal to the liquidation value plus any accrued dividends.

On Friday, STRK closed down 2.1% at $92.40, while Strategy’s Class A common stock (MSTR) declined by 5.6% to $287.18, according to TradingView.