Strategy is paying investors huge yields to keep buying Bitcoin amid 66,231 BTC spending spree
Strategy is increasingly relying on preferred stock (STRC) offering high yields to fund its Bitcoin purchases, acquiring 66,231 BTC in 68 days.Summary
Strategy, formerly MicroStrategy, is rapidly accumulating Bitcoin, having added 66,231 coins in just 68 days – surpassing its full-year purchases from 2021, 2022, and 2023. This accelerated pace is driven by a shift in funding sources, moving away from common equity (MSTR) and convertible debt towards a newer instrument called STRC, a perpetual preferred stock with an 11.50% annual dividend. STRC has funded 33,976 BTC, worth over $3.5 billion, and is attracting significant investor interest, even outperforming similar products from JPMorgan. While this strategy allows for continuous capital raising, it comes at a cost, with approximately $442 million in annual dividend obligations. Critics like Peter Schiff question the sustainability of this model, while others debate the classification of STRC as 'digital credit.' Despite these concerns, the market has shown relative equanimity, and Strategy continues to leverage its ATM capacity to aggressively purchase Bitcoin.
(Source：CryptoSlate)