Plan to offload 2.5 million 'Stride' stocks for substantial Bitcoin acquisition spree
Bitcoin Buying Spree: Strategy Issues 2.5M Preferred Shares
Hey there! Let's dive into the latest move by MicroStrategy, the world's largest corporate Bitcoin holder. In a bid to boost its Bitcoin purchases, the company announced plans to issue 2.5 million preferred shares, known as "Stride" (STRD).
By opting for equity offerings rather than traditional debt, MicroStrategy reinforces its role as a major player in institutional Bitcoin accumulation. The company plans to use the funds from this offering for general purposes, including Bitcoin acquisition and working capital.
The Details of the Equity Offering
MicroStrategy's latest equity offering involves issuing 2.5 million shares of the 10% Series A Perpetual Stride Preferred Stock (STRD). These shares will offer investors non-cumulative cash dividends at an annual rate of 10%, distributed quarterly starting from September 2025. If the company decides to skip a dividend for a given period, it won't owe the skipped payment in the future.
The firm has the right to redeem all outstanding STRD shares under certain conditions, such as when the total share count drops below 25% of the original issue or due to qualifying tax events. If redeemed, shareholders will receive $100 per share plus any declared but unpaid dividends.
Investor Protections and Controversy
MicroStrategy has also outlined specific protections for holders of its STRD Stock in the event of a "fundamental change." In such a scenario, investors will have the right to demand a cash buyback of some or all of their STRD shares. The repurchase amount will include the stated value of the stock plus any declared and unpaid dividends accrued up to, but not including, the repurchase date triggered by the fundamental change.
However, this move hasn't been universally appreciated by the crypto community, with some commentators, such as an X (formerly Twitter) user, questioning its tactics, stating, "This one now looks like you're running a ponzi scheme, Michael."
Market Trends and Saylor's Viewpoint
At the time of writing, Bitcoin was trading at around $105,318.28, marking a 0.90% gain in 24 hours, as per CoinMarketCap. This surge coincides with MicroStrategy's latest move to strengthen its Bitcoin holdings by acquiring an additional 705 BTC for approximately $75 million.
Michael Saylor, the company's founder and CEO, further reinforced the company's Bitcoin strategy during the Bitcoin 2025 conference in Las Vegas, calling Bitcoin the ultimate form of capital in today's financial world.
In case you're curious, MicroStrategy’s capital stack is structured with five core instruments, ranked by repayment priority. Each layer serves a distinct investor base and provides a balance between downside protection, yield, and exposure to Bitcoin. By issuing preferred shares like STRD, MicroStrategy raises new capital specifically earmarked for Bitcoin purchases. The Bitcoin acquired is then stored in secure, multi-signature cold-storage wallets, treated as a long-term treasury reserve. The company neither trades nor hedges these holdings, adhering to a strict buy-and-hold mandate.
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- The latest move by MicroStrategy, the world's largest corporate Bitcoin holder, involves the issuance of 2.5 million preferred shares, known as "Stride" (STRD), to boost Bitcoin purchases, showcasing the company's emphasis on crypto finance and technology.
- Notably, the 10% Series A Perpetual Stride Preferred Stock (STRD) will offer investors dividends and a cash buyback option if a fundamental change occurs, indicating a focus on investor protections in the DeFi sector.
- Solana, Ethereum, and other major cryptos have witnessed increasing investor interest, mirroring the trend of institutional Bitcoin accumulation driven by companies like MicroStrategy.
- In an effort to expand its business operations beyond Bitcoin, MicroStrategy may utilize the funds from its equity offering for general purposes, indicating a broader foray into the realm of business and technology.
- As Bitcoin prices surge, MicroStrategy's investment in BTC signals potential bullish sentiments within the crypto market, positing the digital currency as a key player in the future of finance.
