MSTR stock rises as Strategy holds Bitcoin, builds $1.59B cash pool

Strategy (formerly known as Microstrategy) MSTR did not buy any Bitcoin last week, but the company used a roughly $2 billion stock sale to strengthen its liquidity position as the cryptocurrency rallied sharply.

Bitcoin rose nearly 25% over the past week and traded around $78,700 after coming near $80,000 on Monday.

Strategy shares gained about 7.2% on Monday before losing most of the gains and was trading 2.5% higher. The shares were up 34% over the past week, outperforming other crypto-exposed stocks such as Coinbase and Robinhood.

Strategy builds $1.59B cash pool

According to a filing with the Securities and Exchange Commission, Strategy sold 18.26 million shares between Aug. 17 and Aug. 23, generating about $2 billion in proceeds.

The company used approximately $136.4 million of the proceeds to repurchase its STRC preferred stock and allocated another $300 million to its US dollar reserve, bringing the reserve to $5.1 billion.

The remaining $1.59 billion was placed into a newly established liquidity account called USD Cash.

Strategy said the pool would provide a “more flexible source of liquidity” and could be used for several purposes, including future Bitcoin purchases, preferred-stock dividends, debt payments and share repurchases.

The move gives the company additional flexibility without immediately increasing its Bitcoin holdings.

Bitcoin holdings remain unchanged

Strategy's Bitcoin holdings remained at 840,447 BTC following the latest reporting period. The company acquired those holdings at an average price of $75,385 per Bitcoin, with a total cost of about $63.4 billion including fees and expenses.

At current prices, the holdings were worth roughly $65.8 billion, representing about $2.4 billion in paper gains.

The company's Bitcoin holdings are equivalent to around 4% of the cryptocurrency's 21 million supply cap.

The decision to hold its Bitcoin position steady comes after a period in which Strategy has adjusted its capital allocation approach.

The company has also expanded programs allowing it to use its balance sheet and securities to support dividends, interest payments and share repurchases.

Bernstein analysts said Strategy's balance sheet had stabilized following recent pressure.

They noted that the company had sold only around 0.8% of its Bitcoin holdings in recent weeks while seeking to strengthen dividend reserves and support STRC buybacks.

The analysts expect Strategy could resume Bitcoin purchases as STRC moves closer to its $100 nominal value. The preferred stock was trading around $96.43.

Liquidity backdrop supports Bitcoin rally

Strategy's latest moves come as Bitcoin has staged a sharp recovery. The cryptocurrency climbed nearly 25% last week, while Strategy's common stock gained 6.1% and closed Friday at $119.25.

Bernstein analysts attributed part of Bitcoin's recent rally to the US Treasury's decision to increase purchases of longer-dated government debt. They said greater liquidity and lower long-term interest rates could provide additional support for Bitcoin.

The broader Bitcoin treasury sector has also expanded, with 197 public companies adopting some form of Bitcoin acquisition strategy, according to Bitcoin Treasuries data.

However, shares of many Bitcoin treasury companies remain well below their 2025 peaks as market valuations relative to net asset value have contracted. Strategy, for example, remains around 74% below its previous peak, according to the data cited by Bitcoin Treasuries data.

For now, Strategy's latest filing shows a shift toward maintaining financial flexibility while keeping its large Bitcoin position unchanged.