Strategy, the company formerly known as MicroStrategy that has become synonymous with corporate Bitcoin accumulation, just introduced a framework that would have been heresy in its own boardroom two years ago. The Digital Credit Capital Framework, adopted on June 29, includes provisions for conditionally selling Bitcoin.
MSTR stock responded by climbing as much as 12% on the day.
What the framework actually does
The Digital Credit Capital Framework is essentially a three-legged stool of capital management tools that Strategy has been missing. First, it authorizes up to $2 billion in stock repurchases. Second, it raises the dividend rate on its STRC preferred securities to 12% from 11.5%. Third, and most notably, it permits conditional monetization of Bitcoin holdings, with potential sales of up to $1.25 billion under specific market conditions.
The framework defines specific triggers, such as when preferred stocks trade below par value, that would activate the option to monetize BTC holdings.
