Known for its heavy investment in Bitcoin BTC/USD, Strategy MSTR on Tuesday revealed plans to raise $500 million by offering 5 million shares of a new type of stock called Series A Perpetual Strife Preferred Stock, or STRF, to the public.
What HappenedL The company stated that the money raised will be used for everyday business needs and to buy more Bitcoin, continuing its strategy of building a large Bitcoin reserve.
Strategy on Monday added 130 more Bitcoin to its reserves, bringing its total BTC holdings to 499,226.
This move comes as Strategy, previously known as MicroStrategy, aims to strengthen its position as the world’s largest corporate holder of Bitcoin, a digital currency that has seen significant price swings in recent years.
The STRF stock offers investors a steady 10% annual dividend, meaning they’ll receive regular payments four times a year—on March 31, June 30, Sep. 30, and Dec. 31—starting from June 30, 2025.
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However, these payments aren’t guaranteed and depend on Strategy’s board deciding to declare them.
If the company misses a payment, the unpaid amount will grow at an initial rate of 11% per year, and this rate could climb as high as 18% if payments remain unpaid over time.
“The perpetual strife preferred stock will accumulate cumulative dividends at a fixed rate of 10.00% per annum,” Strategy stated in its announcement, explaining the potential for investors to earn steady returns.
Strategy also outlined that each share of this new stock starts with a value of $100, but this value can change daily based on the stock’s recent trading prices.
The company has the option to buy back all the shares if fewer than 25% of the originally issued shares remain in circulation or if certain tax issues arise.
If a major event, like a significant change in the company’s structure, happens, investors can demand that Strategy repurchase their shares at the initial $100 value plus any unpaid dividends.
“Strategy intends to use the net proceeds from the offering for general corporate purposes, including the acquisition of Bitcoin,” the company noted.
What’s Next: The offering is being managed by major financial firms, including Morgan Stanley, Barclays, Citigroup, and Moelis & Company, who are helping Strategy navigate the sale.
This isn’t the first time Strategy has turned to the stock market to fund its Bitcoin purchases—earlier this year, it raised $584 million through a similar stock offering and has been steadily increasing its Bitcoin stash since 2020.
However, the company’s heavy reliance on Bitcoin has raised concerns among some investors, given the cryptocurrency’s volatility, with its price dropping to around $81,000 on Tuesday after hitting higher levels earlier in the year.
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