Strategy pauses Bitcoin buys, spends $205M on STRC buybacks

Strategy paused its Bitcoin purchases during the week of October 19 and 25, choosing instead to repurchase 2,068,459 shares of its STRC preferred stock. The company spent $204.9 million of its USD cash on these buybacks, which occurred between Monday and Friday. No shares were sold through its at-the-market offering program during this period. This shift in capital allocation resulted in a significant decrease in the company's liquid assets, with the USD cash balance falling to $242.4 million from $447.3 million the previous week.

The decision to prioritize share repurchases over new Bitcoin acquisitions coincides with regulatory developments affecting index inclusion. MSCI is finalizing a rule that may remove non-operating companies from its Global Investable Market Indexes by November 30. Strategy chairman Michael Saylor has urged MSCI to drop the rule, describing it as discriminatory. The company has not provided a timetable for resuming Bitcoin purchases. Since the start of October, Strategy has spent approximately $664 million repurchasing STRC preferred shares, compared with $72.3 million used for Bitcoin purchases.

Strategy’s total Bitcoin holdings remained unchanged at 848,517 BTC. The company acquired these coins for a total of $64.02 billion, resulting in an average price of $75,446 per coin. This average cost creates a paper gain of around $3.9 billion. The USD reserve remained steady at $4.83 billion, intended to cover preferred dividends and debt interest. Buying STRC shares below their $100 face value shrinks the preferred claim and lifts the net bitcoin per share.

Market conditions during the week saw Bitcoin fall toward $80,000 after reaching a high of $84,777 on Wednesday. Strategy’s common stock, MSTR, fell 2.2% to $142.80 in Monday's premarket activity. The company continues to hold its existing Bitcoin position while managing its balance sheet through preferred stock repurchases.