Strategy Buys Almost $1 Billion in Bitcoin Again in Past Week

Michael Saylor’s Strategy Inc. acquired almost $1 billion in Bitcoin for a second consecutive week, as the original digital asset treasury company continues to ramp up purchases following the recent pullback in the price of the largest cryptocurrency.

The former MicroStrategy bought $980.3 million of the digital asset between Dec. 8 and Dec. 14, according to a regulatory filing on Monday. This marks the company’s largest amount of Bitcoin acquired since July and its second consecutive week of acquiring over 10,000 Bitcoin on its books - the first time this has happened since January.

The majority of the most recent acquisitions were made using proceeds from at-the-market sales of its Class A common stock. Critics of Saylor’s model have raised concern that selling the shares is diluting existing equity of shareholders and eroding the formally high premium the stock garnered over its now roughly $59 billion Bitcoin holdings. The Tysons Corner, Virginia-based company also sold shares of three of its four classes of perpetual preferred shares to fund the purchases.

Shares of Strategy fell about 6.7% to $164.60 as of 10:22 a.m. in New York, while Bitcoin dropped about 1.8% to $86,885. Bitcoin is down about 30% from an all-time high of just over $126,000 reached in early October.

Despite the recent flurry of market speculation regarding whether the firm will be removed from key indexes, the NASDAQ 100 opted late Friday to keep Strategy in the index after its annual reconstitution, removing an imminent threat of potentially more selling pressure. The common share price premium over the enterprise value of the company is about 1.1

Last week, Strategy called for MSCI to abandon a proposal to remove digital asset treasury firms whose crypto holdings constitute over half of its total assets from its global equity benchmarks. In a letter to the MSCI Equity Index Committee, Strategy warned of “profoundly harmful consequences” if MSCI adopts the proposal. A decision from MSCI is expected by Jan. 15.