Strategy to Raise $500M for Bitcoin Purchases Through Stock Offering

Highlights:

• Strategy plans to raise $500 million to buy more Bitcoin through a new preferred stock offering.
• The company now holds 499,226 BTC after a recent $10.7 million purchase at $82,981 per Bitcoin.
• The new preferred stock pays a 10% annual dividend with rates rising if dividends are not paid.

Strategy has filed with the U.S. Securities and Exchange Commission to raise $500 million through a stock offering to fund more Bitcoin purchases. The company will issue 5 million shares of its 10.00% Series A Perpetual Strife Preferred Stock at $100 per share. The document submission follows Strategy’s goals of expanding their Bitcoin treasury beyond 500,000 BTC. The proceeds from this offering will fund diverse corporate needs that extend to Bitcoin purchases and operational requirements.

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Strategy today announced the launch of $STRF ("Strife"), a new perpetual preferred stock offering, available to institutional investors and select non-institutional investors. For more information, click here. $MSTRhttps://t.co/YxNmogceGq

— Strategy (@Strategy) March 18, 2025

Strategy also noted in its prospectus that Bitcoin’s price volatility could affect the value of the Bitcoin it buys with these funds. If the price of Bitcoin drops, the company may convert its newly purchased Bitcoin into cash at a value below the net proceeds from this offering.

Two weeks earlier, the company disclosed a separate plan to raise $21 billion for more Bitcoin acquisitions by selling its 8.00% Series A perpetual strike preferred stock at a par value of $0.001 per share.

Strategy’s Bitcoin Purchases and Current Treasury Position

On Monday, Strategy announced that it had purchased 130 Bitcoin for $10.7 million at an average price of $82,981 per Bitcoin. According to an SEC filing, the acquisition used proceeds from selling 123,000 shares of its 8.00% Series A perpetual strike preferred stock. After the purchase, the company now holds 499,226 BTC worth approximately $41.6 billion at current market values.

Strategy has acquired 130 BTC for ~$10.7M at ~$82,981 per bitcoin and has achieved BTC Yield of 6.9% YTD 2025. As of 3/16/2025, we hodl 499,226 $BTC acquired for ~$33.1 billion at ~$66,360 per bitcoin. $MSTR $STRK https://t.co/8xRmR8vlIt

— Michael Saylor⚡️ (@saylor) March 17, 2025

Strategy has acquired greater than 2% of the Bitcoin’s total supply. In particular, this positions it as the world’s biggest corporate holder of Bitcoin. Since the company began acquiring Bitcoin, its stock value has failed to match the continuous growth of its cryptocurrency investments. Strategy’s shares, listed under the ticker MSTR, have declined by more than 23% over the last three months. Despite recent purchases, the stock continues to trade lower, reflecting a broader market reaction.

Preferred Stock Terms and Market Reaction

The perpetual strife preferred stock carries a fixed annual dividend rate of 10%, payable quarterly, beginning on June 30, 2025. The accumulation of delayed dividends by Strategy will begin with 11% annual interest that increases quarterly to reach a yearly maximum of 18% until all accumulated dividends are paid. The preferred stock features an initial liquidation preference of $100 per share, which adjusts daily according to market price movements.

Moreover, Strategy retains the right to redeem all shares if the outstanding amount falls below 25% of the total issued or if certain tax events occur. The company also revealed that if a fundamental change occurs under the terms of the preferred stock, shareholders will have the right to request a repurchase of their shares at a cash price equal to the stated amount plus any unpaid dividends.

Meanwhile, Nasdaq data shows that MSTR shares are currently trading around $274, which is down more than 3% in pre-market trading and lower than yesterday’s closing price of $294. Morgan Stanley, Barclays Capital, Citigroup Global Markets, and Moelis & Company are acting as joint book-running managers for this offering, which is being made through a shelf registration statement filed with the SEC.

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