In a significant strategic pivot, Strategy, a major bitcoin holder once known for its "buy only, never sell" stance, has executed its largest-ever sale of the cryptocurrency, divesting 3,588 bitcoins for approximately $216 million.
The sale was conducted in two transactions over the past week at an average price of around $60,000 per bitcoin. Following this divestment, Strategy retains a holding of roughly 844,000 bitcoins, representing about 4% of the total bitcoin supply, with an average cost basis of approximately $75,000 per coin. This indicates the recent sale was executed at a price substantially below the company's average cost, resulting in a realized loss of about $53 million.
This transaction is part of a newly authorized $1.25 billion "Bitcoin Monetization Plan." The company stated that the proceeds from the sale will be used to pay dividends on its preferred stock and to bolster its corresponding U.S. dollar reserves. As of early July, Strategy's dollar cash reserves stood at approximately $2.55 billion, sufficient to cover about 17 months of preferred stock dividends and interest expenses.
This move marks a major shift in the company's approach. Strategy (formerly known as MicroStrategy) has long been renowned for its aggressive bitcoin accumulation strategy, with its Executive Chairman, Michael Saylor, having repeatedly emphasized a commitment not to sell the digital asset. However, against a backdrop of persistently low bitcoin prices and pressure on the company's own stock, the decision has been made to employ more flexible financial measures to safeguard shareholder returns and financial flexibility. Following the announcement, Strategy's stock fell about 2% in pre-market trading, and the bitcoin price also experienced a slight dip. The market, however, has largely interpreted this as a one-off liquidity management operation rather than the start of a systemic sell-off.
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