The strategy increased its reserves by $300 million while adding 520 Bitcoins worth about $35 million, highlighting the growing focus on capitalization and ongoing cryptocurrency purchases.
Summary
- The strategy bought 520 Bitcoin for $35 million, raising its total value to 847,363 BTC.
- A June 22 filing showed the company increased reserves by $300 million to $1.4 billion.
- The debate over STRC intensified as critics questioned the strategy’s capital structure despite Saylor’s defense.
According to a June 22 filing, the company acquired 520 Bitcoin at an estimated value of $67,068 per coin, bringing the total holdings to 847,363 BTC.
The purchase followed a familiar signal from CEO Michael Saylor, who posted “Looks better with more dots” on X the previous day alongside Strategy’s Bitcoin earnings chart, a picture traders are watching closely for clues about future purchases.
While recent acquisitions have widened Strategy’s accumulation, acquisitions have shown much greater movement elsewhere on the balance sheet. Retained earnings increased by $300 million to $1.4 billion after the company sold 2.71 million MSTR shares for approximately $335.5 million during the past week.
Reserves are the best
In the filing, Strategy said it plans to continue to replenish its USD Reserve to support the credit quality of its Digital Credit securities. The disclosure came as investors remained focused on STRC, the company’s preferred stock, which recently traded below its $100 price tag.
Only a small portion of the proceeds from the sale of MSTR shares appears to have been directed towards recent Bitcoin purchases. The rest is held in cash, a move that has fueled discussions among market participants that supporting the STRC has become an immediate priority.
Some investors expect Strategy to raise STRC’s share price to boost demand and help the preferred stock return to value. Some have suggested stock buybacks as another possible option.
Earlier on June 21, Saylor defended the company’s financial model as criticism surrounding STRC grew. According to comments shared by Saylor, Strategy’s combined Bitcoin and cash holdings exceed its outstanding debt by nearly $48 billion. He also said that the company has raised more than 60 billion dollars since 2022 and invested those funds in the purchase of Bitcoin.
Critics question the grand structure
Meanwhile, the debate over Strategy’s financing method has intensified as the company continues to issue securities while expanding its Bitcoin treasury.
Longtime Bitcoin critic Peter Schiff asserted that investors could end up pursuing legal action against Strategy and Saylor. Schiff also said that the way STRC was raised may have violated the SEC’s marketing rules, although no regulatory findings supporting that accusation have been announced.
Different concerns arise from institutional investors. As previously reported by crypto.news, Arca’s Chief Investment Officer Jeff Dorman suggested that the Strategy may eventually need to sell between $3 billion and $4 billion of Bitcoin to reduce pressure on its capital structure and support STRC holders.
The discussion comes as Strategy purchases remain closely linked to market sentiment. Earlier this month, the company briefly interrupted its long-term accumulation pattern by selling a small amount of Bitcoin before resuming purchases. The strategy later said the transaction did not change its long-term Bitcoin strategy.
Despite the criticism surrounding the company’s funding model and MSTR’s ongoing share sale, investors seem to be embracing Bitcoin’s latest acquisition. MSTR shares rose 3.44% to $116.40 in premarket trading on June 22, extending gains after Saylor confirmed a new addition to Strategy’s Bitcoin reserves.
