₿ Strategy Sells $105M in Bitcoin to Prop Up Its Own Preferred Stock
Strategy sold 1,638 BTC for $104.7 million last week, according to an 8-K filed Monday, cutting its stack to 842,138 coins from the 843,775 it had held since early July. The BTC was sold at an average of $63,957, roughly $11,500 below the company’s $75,419 cost basis, so Strategy is selling Bitcoin at a loss. It hasn’t bought any since June 22, its longest pause ever. They also sold $291M in MSTR shares.
Of the proceeds, $52.4 million funded dividends on Strategy’s preferred stock, and $52.3 million went toward an $81 million buyback of its STRC preferred shares, the second such repurchase in two weeks under a $1 billion program. The rest of the funds went to cash reserves, now up to $4 billion and what the company calls 2.3 years of runway.
Take a step back and realize what is happening. STRC has traded below its $100 par value since mid-May, so Strategy is now selling Bitcoin at a loss and diluting common shareholders through MSTR sales to prop up the preferred stock (STRC), whose slide has been weighing on the whole structure. It’s not great.
Additionally, Saylor’s messaging has shifted completely from the “never sell” era. In fact, he even came out and said yesterday that “When I say ‘Never Sell Your Bitcoin,’ I speak as one saver to another. I have never sold mine.” That, of course, is a pivot from earlier messaging where he went as far to say, “Sell a kidney if you must. But keep the Bitcoin.” Again, not great.
As for Bitcoin, it has absorbed a week filled with very bad news with the $100M+ Coldcard hack and Saylor dumping $100M himself. And yet, the price is flat on the week. Negative news is no longer impacting the price. Perhaps a sign for where we’re at in the market cycle…
🌎 Macro Crypto and Markets
- Crypto majors are green; BTC +2% at $63.8k; ETH +2% at $1,870; SOL +2% at $73.90; HYPE +5% at $55.50
- Top alt movers include ATOM (+8%), PUMP (+6%) and AVAX (+6%)
- Oil even at $79.50; Gold +0.6% at $4,115
- Stock futures are green on new earnings beats; DOW +0.7%, Nasdaq +0.9%
- Solana’s fee-burn and disinflation proposals entered an initial vote on Monday, a pair that would double annual disinflation to 30%, cut emissions by $1.36B over six years, and raise daily burns from 650 SOL (~$47K) to 9,000 SOL (~$646K)
- BlackRock launched tokenized money market funds on Solana and Ethereum, a new vehicle for stablecoin reserves that records ownership onchain via Securitize while investing entirely in cash and short-term Treasurys
- The Coinbase BTC Premium Index just set a record for longest negative streak at 78 days, indicating a long lack of buy pressure from U.S. retail
- Telegram was briefly removed from the Apple App store, causing the GRAM token to briefly sell off by 10% (now down 1%)
- A former FBI counterintelligence agent was charged with stealing ~$1 million in crypto from wallets tied to investigations, then asking ChatGPT how to invest it and move to Europe
Corporate Treasuries & ETFs
- The Bitcoin ETFs saw $170M in net inflows on Monday; the ETH ETFs saw $12M in outflows
- Tom Lee’s BitMine bought another 10,399 ETH, lifting its stash to nearly 5.8 million ETH, about 4.8% of supply, and repurchased 4.5 million of its own shares
Meme Coin Tracker
- Meme leaders were green; DOGE +2%, SHIB +4%, PEPE +2%, PENGU +1%, TRUMP +2%, BONK even
- Robinhood chain was led by Cashcat (+43%), Tendies (+54%) and Frong (+25%); Stonkbroker rebounded 5% to $40M
- Solana leaders included DOOM (+130x), Tiktok (+115x) and OnlyMarms (+440%); CATE fell from $80M to $10M in a nasty sell off, ending the day down 30% at $30M
💰 Token, Airdrop & Protocol Tracker
🚚 What is happening in NFTs?
- NFT leaders were green; Punks even at 32.3 ETH, BAYC +3% at 8.41 ETH, Pudgy +1% at 3.88 ETH; Stonkbrokers -7% to 6.4 ETH
- Pitboys (+43%), Cashcats (+50%) and Zaibatsu (+540%) led top movers
- TokenWorks announced 80% buybacks for FWA using platform fees once the token goes live for trading today at 3 pm ET, using 10% of existing fees to build a team treasury, and lower fees to use the platform
Freedom Index
