Strategy Inc. announced plans on Monday for a $1.44 billion U.S. dollar (USD) reserve – a move that quickly sparked debate among crypto analysts.
Previously known as MicroStrategy, the company holds 650,000 Bitcoin (BTC), making it the largest publicly traded company holding the cryptocurrency. This total includes a recent purchase of 130 BTC for about $11.7 million at roughly $89,960 per coin. Bitcoin is currently trading at $84,932, down sharply from $125,000 in October.
The new USD reserve is intended to cover dividend payments on preferred stock and interest on the company’s debt. Strategy funded it by selling Class A common stock through its at-the-market offering program, according to an official press release.
The company said it plans to keep at least a year’s worth of payments in reserve and may increase that amount depending on market conditions. Founder and Executive Chairman Michael Saylor said the reserve is meant to complement the company’s Bitcoin holdings.
“In recognition of the important role we play in the broader Bitcoin ecosystem, and to further reinforce our commitment to our credit investors and shareholders, we have established a USD Reserve that currently covers 21 months of Dividends,” said Phong Le, President and CEO of Strategy. “We intend to use this reserve to pay our Dividends and grow it over time.”
To continue reading this as well as other DeFi and Web3 news, visit us at thedefiant.io
