MSTR•MSTR•Strategy unveiled a Digital Credit Capital Framework permitting up to $1 billion in share buybacks, $1 billion in preferred repurchases and the sale of Bitcoin to fund an increased 12% preferred dividend. It held $2.55 billion in reserves, covering 17.4 months of preferred and debt obligations, marking a shift to active capital management.
Strategy launched the Digital Credit Capital Framework to monetize Bitcoin holdings, finance a new $1 billion share repurchase authorization, and execute a $1 billion plan to repurchase preferred securities. The program allows Bitcoin sales to cover preferred dividends, replenish cash reserves and fund buybacks without abandoning Bitcoin as its primary treasury asset.
As of the announcement, Strategy held $2.55 billion in reserves, enough to cover 17.4 months of annual preferred dividend and $1.76 billion of debt interest obligations. A board-mandated minimum reserve policy requires at least 12 months’ coverage, with any reduction below that threshold requiring board approval.
The board authorized a $1 billion buyback of common shares to support the stock price and a separate $1 billion repurchase plan for preferred securities. These measures aim to enhance shareholder value and provide liquidity alternatives amid market fluctuations.
Strategy raised the dividend rate on its Variable Rate Series A Perpetual Stretch Preferred Stock from 11.5% to 12%, effective for record dates on or after July 1. This move marks a clear shift from its previous one-way debt issuance for Bitcoin accumulation to active capital management focused on liquidity and balanced returns.
Finance
