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Strategy to prioritize cash reserve and STRC over MSTR buybacks

Strategy holds $4.8 billion in U.S. dollars and says it could still repurchase MSTR if shares trade at a deep discount to NAV.

Reported · Written up by our desk · Market Structure

Strategy is prioritizing cash reserves and its preferred stock business, especially STRC, over stock buybacks, Executive Chairman Michael Saylor said in a Monday Q&A, according to CoinDesk. Saylor said buybacks are “not a priority,” but Strategy could repurchase its own shares if MSTR trades at a “very, very deep discount” to NAV.

The company plans to maintain larger cash balances to support STRC’s dividend payments, CoinDesk reported. Strategy also said it could sell bitcoin when needed, as it balances funding, income payouts, and flexibility to buy digital assets.

CoinDesk noted that Strategy’s common shareholders have faced a rough stretch as MSTR fell about 38% this year and 73% year over year, driven in large part by bitcoin’s decline to about $64,385.25. Strategy has also continued issuing common stock to fund bitcoin purchases, build cash reserves, pay dividends, and repurchase preferred stock.

CoinDesk added that CEO Phong Le defended Strategy’s practice of selling new MSTR shares. He said selling shares can help when MSTR trades above the value of the assets backing each share, potentially increasing the bitcoin backing per MSTR share, while the company emphasizes maintaining enough cash to cover STRC dividends.

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