Strategy raises $1.44B reserve to calm FUD in Bitcoin slump
Strategy has raised a $1.44 billion U.S. dollar reserve to address investor concerns during a Bitcoin downturn, CEO Phong Le said in a Friday interview on CNBC’s Power Lunch. The company said the reserve was established via a stock offering to bolster confidence in its liquidity and dividend coverage.
According to Strategy, the reserve is intended to cover at least 12 months of dividends initially, with plans to expand to a 24-month runway. Le said the firm secured the funds in approximately eight and a half days, equivalent to about 21 months of dividend obligations.
The capital raise follows questions about Strategy’s capacity to service debt and maintain dividend payments if its share price were to decline significantly. Le said the move was designed to counter “FUD” and demonstrate the company’s ability to access funding even in a Bitcoin down cycle, adding that the firm did not anticipate issues meeting dividend commitments and did not expect to sell its Bitcoin holdings.
Le reiterated that Strategy would only consider selling Bitcoin if its stock traded below net asset value and the company lacked access to new capital.
Strategy also introduced a “BTC Credit” dashboard, which it says indicates the company currently holds sufficient assets to fund dividends for more than 70 years.
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