Bitcoin treasury company Strategy paused its bitcoin acquisitions between June 22 and June 28, according to an 8-K filing with the Securities and Exchange Commission on Monday, instead opting to expand its USD reserve and announce a digital credit repurchase program.
As part of the firm's new Digital Credit Capital Framework, Strategy established a new board-approved policy governing its previously established USD reserve, requiring it be used only to support the payment of preferred stock dividends and interest expense on outstanding indebtedness. Management must maintain a minimum USD reserve equal to at least 12 months of the company's current expected annual preferred stock dividend payments and interest obligations, according to the filing.
Strategy confirmed a reserve balance is $2.55 billion as of June 28, up from the $1.4 billion disclosed as of June 21, including shares sold but not yet settled as of June 26.
While Strategy's USD reserve has been slowly building again, analysts at CryptoQuant said last week that the firm should go further and stop buying bitcoin altogether for now as its dividend obligations have risen while its cash reserves have fallen sharply.
The reserve was increased using proceeds from at-the-market sales of its Class A common stock, MSTR. Last week, Strategy sold 12,669,017 MSTR shares for approximately $1.15 billion. As of June 28, $24.3 billion worth of MSTR shares remain available for issuance and sale under that program, according to the filing.
