Strategy CEO Defends Bitcoin Sale as the ‘Right Trade’
Key Takeaways
- •Strategy resumed bitcoin purchases on Monday after pausing buys for 10 weeks.
- •During the pause, the company sold small amounts of bitcoin and built two cash reserves.
- •Phong Le said the sales were intended to support capital management and strengthen the company’s balance sheet.
- •Strategy now holds 845,050 bitcoins valued at about $65.1 billion at current prices.
- •The company’s Nasdaq-listed shares fell 2% on Wednesday and are down 22% year to date.
Strategy CEO Phong Le brushed aside concerns about the company selling part of its bitcoin holdings, saying the move was intended to strengthen the firm’s balance sheet.
Speaking to Bloomberg on Tuesday, Le said Strategy now has a “bullet-proof balance sheet” and described the sale as the “right trade at the time” when the company sold bitcoin.
Strategy, the largest corporate holder of bitcoin, resumed buying the cryptocurrency on Monday after a 10-week pause. After stopping its purchases in June, the company instead sold small amounts of bitcoin and built two cash reserves, underscoring how the firm continues to balance its bitcoin strategy with broader capital management needs.
“We don’t really make decisions specifically on bitcoin’s price,” Le said.
He added: “We’re a net accumulator, and so I don’t sit around and say, ‘Well, when am I going to sell Bitcoin next?’ It comes down to a bit of a capital management mathematical equation of when we would do it.”
“I don’t foresee us selling bitcoin as we enter into what I consider a pretty heavy bull market.”
Strategy, formerly MicroStrategy, is an enterprise software company that shifted in 2020 to buying and holding bitcoin. It first purchased the cryptocurrency to protect shareholders from inflation, but has since aggressively accumulated the asset and repositioned itself as a bitcoin treasury. The company now holds 845,050 bitcoins worth $65.1 billion at current prices.
Investors can buy Strategy’s Nasdaq-listed stock, MSTR, to gain heightened exposure to bitcoin’s performance.
This year, Strategy has repurchased some of its preferred stock, STRC, which is trading at a discount, while increasing its dollar cushion.
In July, the company reported a quarterly loss of $8.22 billion. Le said the paper loss was not important for now, and said he expected the stock to rise again next year.
“We’re the J.P. Morgan of the crypto economy, so whether we sell 1,000 Bitcoin out of 840,000 to me is irrelevant to the conversation,” Le said.
Strategy stock (NASDAQ: MSTR) was trading 2% lower on Wednesday, and the shares are down 22% year to date.
This article first appeared on Bitcoin Magazine and is written by Mathew Di Salvo.
