Bitcoin treasury giant Strategy has temporarily paused its aggressive accumulation of BTC, marking the first break in over three months. The pause was confirmed in an SEC filing dated July 7, covering the period from June 30 to July 6, and aligns with the company’s release of its Q2 financial results.
Strategy’s Current Bitcoin Holdings
As of July 6, Strategy holds 597,325 BTC, worth over $65 billion, acquired at an average price of $70,982 per Bitcoin. This represents more than 2.8% of the total 21 million BTC supply and reflects $22.6 billion in unrealized gains, according to executive chairman Michael Saylor.
Saylor subtly acknowledged the pause via social media, stating, “Some weeks you just need to HODL,” alongside a tracker of the firm’s Bitcoin portfolio.
Reason Behind the Pause
This break in acquisitions coincides with the release of Strategy’s Q2 earnings report, which disclosed an unrealized digital asset gain of $14.05 billion and a deferred tax expense of $4.04 billion. In contrast, the Q1 report released in April revealed a $5.91 billion unrealized loss, after which a similar pause occurred.
The company’s shift in funding strategy may have contributed to the slowdown. Strategy has recently transitioned from using common stock sales (MSTR) to raising capital through various perpetual preferred stock instruments, including:
- STRK – 8% annual dividend, convertible
- STRF – 10% fixed cumulative, non-convertible
- STRD – 10% fixed non-cumulative, non-convertible
These instruments are part of the firm’s upsized “42/42 Plan”, targeting $84 billion in equity and debt for Bitcoin acquisitions through 2027.
Broader Impact and Industry Outlook
Strategy remains the largest corporate holder of Bitcoin, with its market cap at $110 billion, trading at a significant premium to its net Bitcoin holdings. Analysts remain divided: TD Cowen supports the premium, citing a self-reinforcing equity-to-BTC dynamic, while Franklin Templeton and others warn of potential negative feedback loops.
Meanwhile, Strategy’s model continues to influence other firms. Companies like Metaplanet (Japan), Tether-backed Twenty One, and GameStop have followed suit, adopting similar Bitcoin accumulation strategies.
Diagnosis
While Strategy’s brief pause may be temporary, it highlights the growing influence and scrutiny surrounding corporate Bitcoin treasuries. As the company manages massive unrealized gains and diversifies its capital sources, its next moves could shape the future of institutional crypto adoption.
Stay tuned for updates as Strategy prepares for its next phase of BTC acquisition.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.