Strive has made its largest ever Bitcoin purchase, adding 6,182 BTC to its reserves. The company’s total holdings have now reached 43,000 Bitcoin.
Competition is intensifying among Bitcoin reserve companies. While Strategy completed the week without making any purchases, Strive bought 6,182 BTC between October 17-23. According to documents submitted to the US Securities and Exchange Commission, the total value of the transactions was approximately $511.4 million.
Strive paid an average of $82,732 per Bitcoin, including transaction fees. With this new purchase, the company’s reserve increased from 36,818 BTC to 43,000 BTC. This marks Strive’s largest single Bitcoin purchase to date.
The total amount the company paid for 43,000 BTC is approximately $3.8 billion. As of October 23, the fair value of the assets was announced as $3.5 billion. According to this calculation, the average cost of the entire reserve is $87,785 per BTC. Therefore, changes in the Bitcoin price can create significant profit or loss fluctuations in Strive’s balance sheet.
Strive has created a $1 billion program to support new purchases by selling its preferred shares, called SATS, on the market. SATS offers a cumulative annual dividend of 15 percent at a stated value of $100. In its initial public offering, 7 million shares were sold at $90 each, generating approximately $630 million in gross proceeds.
The company stated that the funds raised from the program could be used for general corporate purposes and to purchase more Bitcoin. However, the high dividend rate will create a burden of regular cash payments in the future. If the performance from new BTC purchases is insufficient to cover this financing cost, the risk for shareholders may increase.
Strive has risen to the top ranks among publicly traded Bitcoin reserve companies with 43,000 BTC. It needs to purchase another 515 BTC to overtake Twenty One Capital and another 1,001 BTC to overtake Metaplanet.
*This is not investment advice.
