Analysis: Last week, Strategy Group increased its Bitcoin holdings for the first time, primarily using preferred stock as its financing tool.

PANews reported on March 18th that, according to CoinDesk analysis, Strategy Inc. last week used perpetual preferred stock as its primary vehicle for increasing its Bitcoin holdings for the first time, marking a potential shift in its financing model. The company announced on Monday that it purchased 22,337 Bitcoins last week , its fifth-largest acquisition in history. Of this, $1.18 billion, equivalent to approximately 16,800 Bitcoins (at an average price of $70,000), was raised through its STRC perpetual preferred stock program, far exceeding the $396 million raised through its common stock ATM program. The common stock ATM program had previously been its primary tool for accumulating Bitcoin holdings, currently totaling 761,068 BTC.

Based on STRC's current dividend yield of 11.5%, the $1.18 billion issuance will generate approximately $135 million in annual dividend obligations, bringing the company's total annual dividend burden to over $1 billion. The company has set aside approximately $2.25 billion in reserves to cover these obligations, providing a buffer against rising financing costs. Given the more than 70% drop in common stock, the company prefers to support the share price without further diluting equity. Therefore, it will be more selective in its use of common stock in the future, primarily when the net asset value multiple is significantly higher than 1 or when it needs to build up dollar reserves, relying more on STRC financing that avoids issuing new common stock. STRC has fallen below par value of $100 for three consecutive days since its ex-dividend date of March 15. If the one-month volume-weighted average price continues to fall below par value, the company may consider raising the dividend by another 25 basis points to support the price.