Strategy could begin selling Bitcoin to support $1.5 billion debt buyback
- Strategy could sell portions of its Bitcoin holdings to help finance a $1.5 billion convertible debt repurchase program.
- The company plans to retire part of its 2029 convertible notes using cash reserves, equity offerings and potential BTC sales.
- CEO Michael Saylor previously hinted at possible Bitcoin sales following the release of Strategy's Q1 earnings report.
Strategy (MSTR) could begin selling Bitcoin (BTC) to cover its debt repurchase program, the firm stated in a filing to the Securities and Exchange Commission (SEC) on Friday.
Strategy reveals plan to repurchase $1.5 billion senior convertible notes due 2029
The company shared plans to repurchase approximately $1.5 billion in principal amount of its 0% Convertible Senior Notes due 2029 through privately negotiated transactions.
Strategy expects to complete the buyback for roughly $1.38 billion in cash, allowing it to retire part of the debt. The company stated that it may use a combination of existing cash reserves, proceeds from its at-the-market (ATM) offering program and potential sales of Bitcoin holdings to finance the repurchase.
The move has drawn attention across the ecosystem, given Strategy's reputation as the top Bitcoin treasury and CEO Michael Saylor's longstanding "buy and hold" mantra.
Saylor previously hinted that limited Bitcoin sales could be used strategically to support obligations tied to the company's financing structure. The statement was particularly in relation to dividends associated with its STRC perpetual preferred stock program.
He also indicated that Strategy intends to increase its Bitcoin holdings over time, even if short-term liquidity occasionally requires asset sales.
The debt repurchase is expected to settle around May 19, after which the repurchased notes will be canceled. Approximately $1.5 billion in the principal amount of the 2029 convertible notes will remain outstanding.
The notes were originally issued to help finance Strategy's aggressive Bitcoin acquisitions, which have transformed the company into a major proxy for institutional Bitcoin exposure.
Regardless, Strategy continues expanding its Bitcoin treasury. The company disclosed earlier in the week that it purchased 535 BTC for roughly $43 million at an average price of about $80,340.
That acquisition increased Strategy's total Bitcoin holdings to 818,869 BTC acquired at an average price of $75,540 per Bitcoin.
The move also follows Strategy's recent first-quarter earnings report, where the company posted a $14.46 billion unrealized loss tied to Bitcoin price volatility. The loss contributed to an operating loss of $14.47 billion and a net loss of $12.54 billion during the quarter.
MSTR declined by more than 5% on Friday following the announcement.
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