Strategy Establishes $1.4 Billion Cash Reserve and Expands Bitcoin Holdings to 650,000 BTC

Michael Saylor’s company, Strategy, known for holding the largest public reserve of Bitcoin, has announced the creation of a substantial $1.44 billion cash reserve. This reserve is aimed at ensuring dividend payments and managing outstanding debt. Additionally, Strategy has increased its Bitcoin holdings to a total of 650,000 BTC, further solidifying its position in the cryptocurrency market.

Key Takeaways

Strategy is setting up a $1.44 billion cash reserve to support dividend payments and manage debt.
The reserve is sourced from the sale of Class A common stock.
The company intends to maintain the reserve to cover 12 to 24 months of dividends.
Strategy has recently added 130 Bitcoin to its holdings, increasing the total to 650,000 BTC, which is approximately 3.1% of the total Bitcoin supply.

Strategy sets up $1.4B cash reserve, lifts Bitcoin stash to 650,000 BTC

Strategy’s New Cash Reserve

On Monday, Strategy announced the establishment of a $1.44 billion cash reserve, sourced from the profits of selling Class A common stock through its at-the-market offering program. “The current goal is to maintain a USD Reserve sufficient to cover at least twelve months of dividends. We also plan to gradually increase this reserve to ultimately cover 24 months or more,” the company stated.

To complement this reserve, Strategy revealed that it has made an additional purchase of 130 Bitcoin for $11.7 million. This acquisition has boosted its total Bitcoin holdings to a notable 650,000 BTC, which was amassed at a total cost of approximately $48.38 billion.

Enhancing BTC Holdings with a USD Reserve

“The establishment of a USD Reserve to complement our BTC Reserve represents a significant step in our evolution,” said Strategy founder Michael Saylor. He emphasized that this new financial tool aims to better equip the company to weather short-term market fluctuations.

Phong Le, Strategy’s CEO and president, pointed out that the recent BTC purchase within the last two weeks has brought the firm's total holdings to 650,000 BTC, making up about 3.1% of the 21 million BTC that will ever be produced.

Bitcoin Price, MicroStrategy, Michael Saylor, Companies An excerpt from Strategy’s Form 8-K. Source: SEC

To further his commitment to credit investors and shareholders, Le stated, “The USD Reserve we have created currently ensures coverage for 21 months of dividends, underlining our integral role in the wider Bitcoin ecosystem.”

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