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Strategy updates bitcoin metrics to show net reserve after preferred debt
The new framework pegs the equity issuance threshold at 1.0x and says a 3.22% BTC breakeven ARR could cover interest and preferred dividends indefinitely.
Strategy (MSTR) has overhauled the bitcoin metrics it uses to describe its position, replacing gross BTC-based figures with net equivalents that account for preferred stock and convertible debt, in an effort to make its exposure clearer for common shareholders, according to CoinDesk.
The company says its revised net reserve stands at $36.6 billion after subtracting $6.8 billion of out-of-the-money convertible debt and $15.5 billion of preferred stock from its bitcoin and cash reserves.
Strategy also updated its multiple to net asset value, anchoring the equity issuance threshold permanently at 1.0x. CoinDesk reports the metric is designed to indicate whether issuing new shares adds bitcoin per share for investors, depending on whether MSTR trades above its net bitcoin per share.
CoinDesk adds that Strategy’s framework includes a breakeven annual recurring revenue measure of 3.22% based on bitcoin, which the company says would allow bitcoin gains to cover interest and preferred dividend obligations indefinitely, as the firm continues to refine guidance during a bear market that began in October.
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