Strategy to Resume Bitcoin Purchases Once Preferred Shares Recover to Par Value, CEO Says

Bitcoin treasury firm Strategy will resume purchasing the cryptocurrency once its preferred shares, known as Stretch (STRC), recover to their $100 par value, according to CEO Phong Le. The firm has paused its acquisitions since late June, shifting its focus toward building a substantial $3 billion cash reserve to navigate the ongoing digital asset downturn.

Speaking to Bloomberg TV, Le explained that the recovery of the Stretch preferred shares is vital to the company’s capital strategy. STRC has traded below its $100 par value since mid-May, hovering around $89 on Wednesday. When trading below par, issuing new preferred shares to raise capital becomes highly dilutive and unattractive. “When Stretch gets back to par, we’ll issue more. We’ll buy Bitcoin. We may continue to beef up our U.S. dollar reserve,” Le said, though he admitted he is “unsure” of the timeline. He emphasized that issuing more preferred stock remains “a big part of our capital plan,” adding, “because it’s very accretive to our Bitcoin per share, which is accretive to our shareholders.”

## Rebuilding the Balance Sheet

To buffer against market volatility, Strategy recently raised $467 million through a common-stock sale, boosting its liquid cash reserves to $3 billion. This treasury cushion is designed to cover two years of dividend payments. Le framed this transition as a strategic pivot, stating the company is evolving “from being a Bitcoin treasury company to a full digital capital platform.”

Despite concerns that the company is retreating from its aggressive acquisition strategy, Le offered strong reassurances. “We’re not going anywhere,” Le stated. “Anybody that’s worried about Strategy shouldn’t be,” pointing to its massive balance sheet. Strategy remains the largest identified corporate holder of the cryptocurrency, possessing over 840,000 BTC—representing approximately 4% of the total 21 million supply. Addressing the market impact of the company’s recent $216 million in sales, Le noted, “Bitcoin’s a lot bigger than us,” adding that the daily trading volume of $30 billion to $40 billion meant their liquidations “did not move the market.”

## Market Reactions and Capital Frameworks

The $216 million in sales began last month when co-founder Michael Saylor started trimming the firm’s $54 billion holdings, sparking concerns over the stability of the company’s debt-and-equity flywheel established in 2020. However, analysts at Standard Chartered downplayed the anxiety, characterizing the sales as “mostly noise” following Strategy’s introduction of a flexible capital framework designed to allow management to sell Bitcoin, buy back securities, and protect overall liquidity. Le also dismissed reports from Bloomberg suggesting distressed funds were negotiating to swap their STRC holdings, stating the company has not engaged in “any material conversations” regarding such swaps.

When questioned about extreme downside scenarios, Le indicated that the firm’s leverage only becomes a concern at price points far below current levels. While Bitcoin was trading around $64,700 at the time of the interview, Le identified a much lower threshold for financial stress. “When Bitcoin gets down closer to $8,000 to $10,000 is when we’re going to have to consider some of the risk associated with our debt,” Le remarked. “Until that point in time, we feel very secure about the balance sheet.” He viewed the current market correction as part of a familiar cycle: “We’ve been through this in 2022. We’re going through it in 2026, and I’m pretty excited about the next bull market of Bitcoin.”

## Obstacles to the Next Acquisition Phase

Currently, both the company’s equity and the underlying cryptocurrency face significant headwinds. Strategy’s MSTR stock has declined by more than 77% over the past year, while Bitcoin has fallen 45% over the same period, trading at roughly half of its all-time high set in October. This double decline has kept the preferred-share financing mechanism temporarily frozen.

Highlighting the steep climb ahead, users on the prediction market Myriad, owned by Decrypt’s parent company Dastan, place just a 13% chance on Strategy holding over 1 million BTC before 2027. With less than half of the year remaining, the company would need to acquire more than 150,000 BTC to reach that milestone.