MicroStrategy Eyes $500M Raise Through Preferred Stock to Fund More Bitcoin Buys
MicroStrategy (MSTR), the largest corporate holder of Bitcoin, is seeking to raise approximately $500 million through an offering of Perpetual Strife Preferred Stock (STRF) to finance additional BTC purchases. However, signs indicate that investor appetite on Wall Street may be slowing.
According to an SEC filing, STRF will offer a fixed annual cash dividend of 10%, paid quarterly. If dividends go unpaid, they will compound at an additional 1% per year (calculated quarterly), up to a maximum of 18%. The first dividend payment is scheduled for June 30, 2025.
This offering follows Strategy’s previous preferred series (STRK), which initially carried an 8% interest rate, and its earlier convertible debt issuances that featured little to no interest. While STRF holders won’t have voting rights, they will have priority in liquidation, with a $100 per share liquidation preference. The company retains the right to redeem STRF under certain conditions, such as a significant reduction in outstanding shares or specific tax events. Investors, meanwhile, can request a buyback in case of a fundamental change.
STRF is expected to begin trading on Nasdaq within 30 days of issuance, giving investors indirect Bitcoin exposure through a high-yield structure. The offering is being managed by Morgan Stanley, Barclays, Citigroup, and Moelis & Company under an SEC shelf registration.
Despite MicroStrategy’s aggressive Bitcoin accumulation over recent months, its pace of purchases has recently slowed. Last week, the company added just 130 BTC for $10.7 million, bringing its total holdings to 499,226 BTC.
Shares of MSTR dropped 5% in early Tuesday trading, mirroring a broader market downturn and Bitcoin’s decline from $84,000 to $81,300.
