As the company controlling $65 billion worth of Bitcoin increasingly leans on its flagship preferred stock, Stretch (STRC), to expand its Bitcoin holdings, the firm’s efforts to retire a portion of its convertible debt align with a broader deleveraging push.
While Strategy’s Bitcoin holdings showed billions of dollars in losses earlier this year—with the digital asset dropping as low as $62,850 in February—the looming obligations of its upcoming maturities tested faith in the company’s long-term sustainability. Those questions were compounded by regular dividend payments that Strategy has committed to through STRC.
In the filing, Strategy said that it intends to fund the repurchases using available cash reserves, proceeds from its at-the-market common stock offering program, “and/or proceeds from the sale of Bitcoin.”
The remark was made in reference to STRC, which currently offers an 11.5% annual dividend paid monthly. Since Strategy began offering the product to investors in July, STRC’s market cap has ballooned to $8.4 billion, amid heightened issuance in recent months.
When Strategy repurchases notes due in 2029, the company will have $1.5 billion in convertible debt outstanding from that tranche. What’s more, the firm has issued roughly $1 billion in notes that investors can force the company to buy back as early as September 2027.
