Strategy, a prominent publicly traded holder of Bitcoin, significantly expanded its treasury last week by acquiring an additional 34,164 bitcoins. This substantial purchase, executed between April 13 and April 19, amounted to approximately $2.54 billion, making it one of the largest single cryptocurrency acquisitions in corporate history and the third-largest for the company on record. The acquisition was made at an average price of $74,395 per bitcoin, bringing Strategy's total holdings to an impressive 815,061 BTC.

With this latest acquisition, Strategy has solidified its position as the largest corporate holder of Bitcoin, officially surpassing BlackRock's total holdings. While BlackRock's iShares Bitcoin Trust (IBIT) briefly held more BTC earlier in 2024, Strategy's relentless accumulation campaign has now put it ahead, with BlackRock holding 802,823 BTC primarily through its spot Bitcoin ETF products. Strategy has now spent an aggregate total of $61.56 billion accumulating its Bitcoin hoard, at an average cost basis of $75,527 per coin. With Bitcoin trading near the $75,000-$76,000 range, the firm's position remains close to its aggregate purchase price, navigating recent market volatility near a break-even point.

The financing for these massive purchases was primarily facilitated through a combination of equity issuance and preferred stock sales. Strategy raised approximately $366 million through the sale of its standard Class A Common Shares and about $2.18 billion through its perpetual preferred stock offering, known as STRC (Variable Rate Series A Perpetual Stretch Preferred Stock). The STRC instrument has increasingly played a central role in funding recent acquisitions, underscoring Strategy's innovative approach to capital raising for its Bitcoin strategy. The company has billions of dollars in additional common and preferred shares authorized for issuance under existing programs, signaling a broader plan to raise significant capital for further Bitcoin purchases through 2027.

In a strategic move to enhance the attractiveness and liquidity of its STRC preferred stock, Strategy has proposed shifting dividend payments from a monthly to a semi-monthly schedule. The STRC carries an annualized yield of about 11.5% and is designed with a variable dividend structure to maintain a price near par value ($100). This adjustment aims to offer more frequent cash flow to shareholders, thereby making the Bitcoin-backed instrument more appealing to income-focused investors seeking regular liquidity, especially amidst fluctuating Bitcoin markets. The shift to a semi-monthly framework would allow the dynamic rate-setting process to be more reactive to market demands for shorter-duration income streams.

The scale of Strategy's Bitcoin holdings is remarkable, now representing more than 3.8% of Bitcoin’s fixed supply of 21 million coins, which highlights the firm's outsized influence in the cryptocurrency market. Executive Chairman Michael Saylor has consistently signaled the company's aggressive accumulation, often urging observers to “think even bigger,” a phrase synonymous with their ongoing Bitcoin strategy. Following the disclosure of the latest purchase, shares of Strategy experienced a decline of about 2.5% in pre-market trading, reflecting investor sensitivity to both Bitcoin price movements and the company's continued reliance on capital markets to fund its significant acquisitions.