Strategy, the world’s largest corporate bitcoin holder, may tap its Bitcoin reserves among other funding sources to finance a $1.38 billion buyback of $1.5 billion of its 2029 convertible notes, according to a Friday statement.
The privately negotiated deal prices the debt at roughly 8% below par and is set to settle around May 19, after which the repurchased notes will be cancelled.
The plan was announced after Strategy Executive Chairman Michael Saylor outlined a capital strategy under which the company could use its large Bitcoin holdings to fund dividends and financial obligations while continuing to accumulate additional BTC over time.
During the firm’s May 5 earnings call, Saylor said the model is driven by issuing STRC preferred stock and reinvesting the proceeds in Bitcoin purchases.
The company currently owns 818,869 BTC valued at over $65 billion, with unrealized gains estimated at $3.9 billion at Bitcoin prices around $80,000.
Saylor explained that Strategy’s breakeven annual Bitcoin appreciation rate is roughly 2.3%; above that threshold, Bitcoin sales used to fund dividends can be offset by fresh capital raised through STRC issuance, allowing total holdings to continue increasing.
