Michael Saylor's company, Strategy, has initiated a new plan to acquire more Bitcoin by filing for an IPO of a share denominated in euros. This move is specifically designed to raise funds for further Bitcoin purchases. The question remains whether this initiative will be sufficient to reignite buying momentum, which has shown signs of weakening.
In Brief
- •Strategy is launching a euro-denominated stock (STRE) targeted at qualified investors in the EU and the UK.
- •The company intends to sell 3.5 million shares, offering an annual dividend of 10%, to finance its Bitcoin acquisitions.
- •Strategy currently holds 641,205 BTC, with an acquisition cost of 47.49 billion dollars.
Strategy Seeks to Strengthen Bitcoin Positions Through Euro Fundraising
Strategy is taking another significant step in its pursuit of Bitcoin. The company, led by Michael Saylor, filed a request on Monday to issue 3.5 million perpetual shares under the symbol STRE, with each share valued at 100 euros (approximately 115 dollars).
These securities will provide a cumulative dividend of 10%, distributed quarterly, with the first payment scheduled for December 31. The operation is being spearheaded by financial institutions including Barclays, Morgan Stanley, Moelis, and TD Securities.
This initiative represents a strategic shift, as Strategy is now targeting European institutional investors and deliberately excluding retail investors. The company appears to be aiming to diversify its funding sources beyond the United States, where its business model has begun to attract scrutiny.
Michael Saylor remains committed to his strategy. In a conference call last Thursday, he explicitly stated that "the goal is to sell digital credit, improve the balance sheet, buy bitcoin, and communicate this to credit and equity investors." He indicated no intention of merging with competitors or altering the company's course, even if such actions might appear "potentially advantageous."
Contradictory Signals Fueling Doubts
The timing of this announcement is notable. Strategy recently acquired 397 BTC in early November for approximately 45.6 million dollars, increasing its total holdings to 641,205 Bitcoins. This portfolio has shown a return of 26.1% since the beginning of the year. However, these figures may not reflect the full picture.
Strategy's Bitcoin purchases saw a significant decrease in October, with only 778 BTC acquired, a stark contrast to the 3,526 BTC purchased in September. This represents a 78% drop compared to the accumulation pace observed in the first half of the year, when the company was acquiring over 20,000 BTC per month.
This sharp deceleration has caused unease within the crypto community, which has often viewed Saylor's actions as an indicator of institutional confidence in Bitcoin.
Analysts are divided on the implications of this slowdown. Some interpret it as a temporary consolidation phase following a period of intense accumulation. Others express concern that it may signal a defensive posture amidst a Bitcoin market struggling to regain upward momentum.
Strategy's rejection from the S&P 500 in September further fueled these concerns. JPMorgan has characterized this refusal as a "hard blow for crypto treasuries," suggesting that the model of indirect Bitcoin exposure might have "reached its limits."
A Double-Edged Strategy
The issuance of euro-denominated stock represents a bold move for Strategy. The company is attempting to broaden its investor base while simultaneously maintaining its Bitcoin accumulation strategy. However, the increasing number of companies adopting similar approaches could potentially dilute Strategy's competitive advantage. Some analysts worry about market saturation and the possibility of forced buybacks among competitors as they strive to remain viable.
Saylor has dismissed these concerns, firmly rejecting any proposals for mergers or acquisitions and emphasizing his commitment to the company's original strategy. This European IPO will serve as a test of the resilience of this conviction.
If European institutional investors respond positively to this offering, Strategy will solidify its position as the preeminent leader in Bitcoin treasuries. Conversely, if the response is lukewarm, questions regarding the long-term sustainability of this model are likely to intensify.