Strategy, the world’s largest publicly traded Bitcoin treasury company, has brought its net leverage close to zero after accumulating $6.69 billion in dollar liquidity.
The company measures net leverage by subtracting its dollar assets from approximately $6.75 billion of debt and then dividing the remaining amount by the value of its Bitcoin holdings. Strategy’s BTC reserve is currently worth around $66 billion.
Over the past few months, Strategy has prioritized raising capital to strengthen its U.S. dollar reserves. The company now holds about $5.1 billion in its primary dollar reserve, enough to cover roughly four years of its approximately $1.7 billion in annual preferred-stock dividend obligations.
Strategy also maintains a separate $1.59 billion cash pool that can be used for broader corporate needs.
Executive Chairman Michael Saylor said the company’s dollar cash supports its digital credit strategy and can be allocated toward Bitcoin purchases, preferred dividends and interest payments, share repurchases, convertible debt repayments and further additions to its cash reserves.
STRC Recovery Still Short of Par
Strategy’s variable-rate perpetual preferred stock, STRC, has climbed more than 35% from its June bottom and is now trading at about $97.23, below its $100 par value.
The recovery has coincided with Bitcoin’s move back toward $80,000 and Strategy’s continued repurchases of STRC shares at prices below par.
Strategy’s balance sheet also differs from that of Strive Asset Management, another publicly traded Bitcoin treasury company. Strive currently carries no debt after paying off its borrowings earlier this year.
That distinction is significant because debt holders have a higher priority than preferred shareholders in a company’s capital structure.
Strive’s perpetual preferred stock, SATA, has returned to its $100 par value, allowing the company to issue more shares through its at-the-market program last week.
Strategy reduced its own debt exposure in May by repurchasing $1.5 billion of convertible notes due in 2029. Retiring additional debt could further strengthen STRC’s position within the capital structure.
For now, Strategy’s sizable cash reserves, ongoing STRC buybacks and Bitcoin’s recovery could offer near-term support for the preferred stock as it attempts to return to its $100 par value.
