|
| On Monday Strategy said it bought no bitcoin last week and spent $205 million buying back its own preferred shares. We went through its weekly figures since September to see where the money has been going. |
On Monday Michael Saylor posted Strategy's weekly figures: no bitcoin bought, $205 million spent buying back STRC, its preferred stock, and the same number of coins held as the week before. The same morning Strive filed that it had bought 6,182 bitcoin for about $511 million.
Crypto social media read Monday as a day of corporate buying, and the Strive figure is the one most people saw. Strategy holds roughly twenty times as much bitcoin as Strive, so the question for anyone who holds bitcoin is what the bigger company is doing with its money.
We went back through Strategy's own Monday posts since the start of September. In the six weeks to 25 October it bought 3,466 coins and spent $1.09 billion buying back STRC. At the prices of those weeks, that is nearly four dollars on its own shares for every one on bitcoin, on our arithmetic.
Strategy bought three-quarters of those coins in the fortnight to 27 September, when bitcoin reached its high for the autumn. In the four weeks since, as bitcoin slid to $80,000, it bought 851 coins and then none. Its buybacks went the other way, larger every week since the start of October.
Its cash fell as the buybacks rose. Strategy's dollar assets dropped by $1.4 billion in the seven weeks to 25 October, by its own figures.
So the company most people count as the floor under bitcoin has bought less of it at every lower price and spent more on its own shares. Why would it do that, and what does it mean for the price you hold bitcoin at?
STRC is how Strategy pays for bitcoin. It sells the preferred to investors who want its dividend and uses the money to buy coins. Under the company's own rules it can only sell new STRC when the price is above $100, its face value, and below that it buys the shares back instead. It has reported buybacks every week since the start of September, which tells you which side of that line the shares have been trading.
That rule is what turns the biggest holder into a buyer that shrinks as the price falls, and it has a date on it this week.
Continue with The Crossover Pro
The rest of this story, plus two paid editions a week. $24.99 a month, or $249 a year. Already a member? Sign in above.
Subscribe to Pro