The largest corporate bitcoin holder added 334 coins for $28.7 million while repurchasing $176 million of STRC. It also estimated a $20.9 billion third-quarter fair-value gain.
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Strategy's weekly filing usually leads with bitcoin. This week, the bigger number was the company buying back its own securities.
In a filing Monday, Strategy said it bought 334 bitcoin from to for $28.7 million, an average of $85,838.80 a coin, bringing its holdings to 848,000 bitcoin. It bought none from to . The total cost of its holdings is $63.97 billion, or $75,440.70 a coin.
Over the same week, it repurchased $176.3 million of its STRC preferred stock: $102.6 million from to 30 and $73.7 million from to 4. That is about 6.1 times what it spent on bitcoin.
How it paid
The bitcoin purchase was funded with $15.7 million from selling 92,894 common shares and $13.0 million of cash. Strategy has $547.2 million left under its preferred-stock repurchase program. A separate $1 billion program for its common stock has not been used.
The company holds a U.S. dollar reserve of $4.88 billion. It drew $142.5 million from that reserve to pay preferred dividends and interest during the week.
The third-quarter mark
Strategy estimated a $20.91 billion gain on its digital assets for the third quarter, with a carrying value of $70.82 billion. The gain is a fair-value estimate based on bitcoin's price, not cash earned. It comes with $1.88 billion of estimated deferred tax expense. Strategy also reversed a $4.12 billion deferred tax asset it had recorded at and released the related valuation allowance.
Where bitcoin traded
Bitcoin traded near $85,440 on Monday afternoon, slightly below the average price Strategy paid last week. Strategy shares rose about 1.5% to around $162.48.
Smaller buyers, bigger checks
Strive, a smaller corporate holder, outspent Strategy on bitcoin last week. It said it bought 2,000 bitcoin between and at about $84,422 each, roughly $169 million, bringing its total to 29,462. That is nearly six times Strategy's weekly bitcoin purchase. Strive bought 8,137 bitcoin in the third quarter, has no debt and held $284.7 million in cash.
The reading
One reading is that the buybacks are rational. Buying back preferred stock at a discount to its face value can add value for common shareholders, and Strategy has the reserve to support payouts.
A second reading is that the shift signals weaker capacity to raise new money. The company sold only $15.7 million of common stock in the week, and is using cash to support its preferred instead of adding bitcoin. A third is that smaller holders such as Strive are becoming the marginal corporate buyer.
Next filing
Strategy's weekly filings will show whether preferred buybacks continue to outpace bitcoin purchases. Its third-quarter report will confirm the estimated gain and the tax effects.