The recent volatility in cryptocurrency markets has cast a spotlight on Strategy’s aggressive accumulation of Bitcoin, testing the resilience of its investment model. A sharp weekend decline in Bitcoin’s value transformed paper gains into potential losses, raising questions about the timing and financing of the company’s latest purchase.
A Precarious Position Near Break-Even
As of February 1, Strategy holds a substantial treasury of 713,502 Bitcoin. The total cost for this position is approximately $54.26 billion, resulting in an average acquisition price of $76,052 per BTC. The asset’s price briefly dipped below $75,000 during Sunday’s Asian trading session, touching around $74,500—a level not seen since early 2025. This move temporarily pushed Strategy’s unrealized losses toward the $1 billion mark. A subsequent recovery to the mid-$77,000 range narrowed the gap significantly, leaving the company’s Bitcoin holdings hovering near their break-even point.
Key Data Points:
* Bitcoin Holdings: 713,502 BTC
* Average Purchase Price: $76,052 per BTC
* Most Recent Acquisition: 855 BTC for $75.3 million
* Funding Method: Sale of common stock
Questionable Timing on Latest Acquisition
According to a Monday release, the company’s most recent purchase involved 855 Bitcoin for about $75.3 million, financed entirely through the sale of common equity. The average price paid was $87,974 per coin. This acquisition occurred just before the market downturn, shifting focus from growth potential to the sensitivity of the company’s balance sheet during rapid corrections.
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Rising Capital Needs and Investor Incentives
Concurrently, Strategy is actively seeking to attract additional capital. The firm increased the dividend on its “Variable Rate Series A Perpetual Stretch Preferred Stock” (STRC) by 25 basis points to 11.25%. This adjustment applies to monthly periods starting February 1, 2026, and marks the sixth such increase since the security began trading in July 2025.
The company reports it has established $2.25 billion in reserves to cover dividend obligations for these perpetual preferred shares. Annual dividend payments from these instruments total roughly $887 million. Furthermore, between January 26 and February 1, Strategy sold 673,527 Class A shares, generating net proceeds of $106.1 million.
The market’s reaction to this mix of heavy Bitcoin exposure and ongoing capital raising has been pronounced. Strategy’s share price has declined sharply, closing at €119.60 on Monday. This places it just above its 52-week low of €118.90.
Attention now centers on two critical factors: whether Bitcoin can stabilize above Strategy’s average cost basis, and if the company can continue funding its strategy—including the heightened preferred dividend payments—under sustainable market conditions.
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