Strategy, Michael Saylor’s Bitcoin-bricked Roman Empire, just rolled out an orange colored plot twist sending shockwaves through the crypto community. For the first time in four years, Saylor’s BTC treasury company sold 32 BTC amounting to $2.5 million last week.
Strategy disclosed details about the sale in an 8-K filing with the SEC. The filing said that the 32 BTC were sold at an average sale price of $75,699 within the time frame of May 26 and May 31.
However, this sell-off from Saylor’s famous “HODL” commitment has hit the market immediately, with Strategy shares tumbling over 5.7 percent on Monday.
Saylor, in conversation with The Coin Headlines last December, had categorically denied all reports claiming that his company was going to sell Bitcoin emphasising that there was “no situation” under which he saw that happening. So, what changed?
Strategy’s side to BTC sell-off
Strategy’s SEC filing noted that the proceeds from the BTC sale are intended to fund preferred stock dividends and pay their most important shareholders the capital they were promised.
Now, Strategy regularly issues high-yield preferred stock to rope-in the funding to invest in new stash loads of Bitcoin. These shares, however, come with strict and mandatory dividend deadlines.
The Virginia, U.S.-headquartered company sought it a better move to sell a miniscule fraction of its BTC to process these payouts than dilution or having to take a new, equity debt — which would have been more expensive.
As per its SEC filing, Strategy held 843,706 BTC in its treasury worth over $63 billion as of May 31.
Source: SEC
For the upcoming cash dividend payments for June 30, Strategy will be releasing $2.50 per share for the holders of the STRF and STRD stocks. Meanwhile, STRK holders will receive $2.00 per share and STRC holders will recieve a monthly dividend of approximately $0.958 per share.
Market reaction
Earlier this month, Saylor had told the Strategy community that the company may have to sell some BTC to improve its balance sheet — a step he did not stray away from.
The action has opened floodgates of mixed reactions as the 61-year-old businessman has kept the “never sell” sentiment as the cornerstone of his company for years.
While what Strategy sold represents just 0.004 percent of its massive holdings, investors are now wondering if the company that controls four percent of the total BTC supply, could become a consistent structural seller in the coming future.
Because Strategy had not sold a single satoshi (the smallest unit of BTC) since its 704 BTC tax-loss harvest back in December 2022, this sudden move has left some onlookers rather spooked. While, many crypto KOLs, agree that a minor 32 BTC liquidation is no reason to panic, Saylor’s biggest critic, Peter Schiff didn’t miss the opportunity to take another swipe at Saylor.
Last week, Strategy had claimed that it has achieved BTC Yield of 13.3 perceny and BTC Gain of BTC 89,378, worth approximately $6.8 billion on teh year-to-date metric.
At the time of writing, BTC was trading at $71,511 at a loss of over 2.7 percent over the last day, data by CoinMarketCap showed on Monday. After hitting its ATH of over $126,000 last year in October, the asset has registered a massive fall owing to international trade wars, geopolitical tensions, and stalling regulatory clarity in major economies like the U.S.