Strategy bought more bitcoin again. Last week, the company, formerly known as MicroStrategy, spent another $100 million on BTC. Over the past few years, such purchases have made it the largest corporate holder of bitcoin in the world. But as reserves have grown, so has the debate: what do ordinary MSTR shareholders actually get?
On June 15, Michael Saylor announced that Strategy bought 1,587 BTC at an average price of $63,024 per coin. After the deal, the company had 846,842 BTC on its balance sheet.
This is more than 4% of the entire bitcoin supply, which is capped at 21 million coins. In essence, Strategy has long been seen not just as a software company, but as a public vehicle for betting on BTC.
But the timing for the new purchase was not the calmest. Bitcoin has pulled back from recent highs, Strategy shares are under pressure, and the number of bitcoins per share dropped again after the deal.
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Because of this, an old question has returned: is Strategy really creating value for common shareholders, or are shareholders getting an ever smaller share of the company’s bitcoin reserves amid new offerings and a more complex balance sheet structure?
BTC Holdings Grow, but BTC Yield Falls
According to documents filed with the SEC, the latest purchase by Strategy was financed by selling class A common stock.
Over the week, the company sold about 1.7 million MSTR shares and raised about $209 million. About $100 million went to buy bitcoin, and another $100 million was added to the dollar reserve. After this, the cash reserve grew to about $1.1 billion.
Strategy still has the ability to sell up to $25.75 billion in MSTR shares under the current market offering program. In addition, the company expanded its set of capital-raising tools: this includes another $21 billion in common shares, $21 billion in preferred shares STRC, and $2.1 billion in preferred shares STRK.
It is the scale of these programs that worries critics most. Each new offering again raises the issue of diluting existing shareholders.
At the center of the debate is the BTC Yield metric. It shows how the number of bitcoins per fully diluted share changes.
On June 1, BTC Yield was 13%. By June 8, it had dropped to 12.8%, and after the latest purchase, it fell to 12.5%.
At the same time, Strategy‘s reserves grew from 843,706 BTC to 846,842 BTC during this period. So the company has more bitcoins, but the per-share metric has worsened.
Number of bitcoins per Strategy share. Source: Strategy
For critics, this is the main signal. Strategy bought BTC again, but by the company’s own methodology, ordinary shareholders now effectively get fewer bitcoins per share.
Bitcoin enthusiast and longtime critic Matthew Kratter pointed this out. He believes the drop in BTC Yield indicates shareholder dilution.
On X he wrote that Saylor and Strategy have diluted MSTR holders again, and the bitcoins-per-share metric has dropped once more.
Saylor Does Not Consider the Deal Dilutive
Michael Saylor disagrees with this assessment. According to him, the latest purchase should not be viewed only through BTC Yield, because this metric considers bitcoins per share but does not show the growth of the company’s cash reserves.
Saylor suggests a broader approach using the metric Common Equity Bitcoin Exposure, or CEBE.
The idea is to look not only at bitcoins per share, but also at debts, preferred shares, and cash on the balance sheet. That is, to assess what portion of assets actually remains for common shareholders after all senior claims.
According to Saylor, Bitcoin Per Share shows growth potential for shareholders. And CEBE BPS is needed as a more cautious metric, because it takes the company’s obligations into account.
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He believes that BTC Yield helps evaluate the execution of the bitcoin accumulation strategy, but does not reflect all the residual value attributable to shareholders.
The more complex Strategy‘s capital structure becomes, the more important this difference is. If the company takes on expensive or short-term obligations, they can quickly start to pressure common shareholders.
But if the financing is long-term and relatively cheap, the logic changes. In that case, bitcoin growth can outpace the cost of capital raised and boost returns for shareholders.
Saylor calls the difference between BPS and CEBE BPS leverage. If Strategy had no debts or preferred shares, these metrics would almost match, and the company would simply track bitcoin’s performance.
But as obligations grow, a gap appears. It can give shareholders returns above BTC, but in a bad scenario, it can also amplify losses.
Therefore, according to Saylor, Strategy‘s obligations cannot all be lumped into one risk category. Expensive short-term financing can become a problem. Cheap long-term capital, on the other hand, can work in shareholders’ favor if bitcoin grows faster than the cost of that capital.
In this logic, the latest deal does look worse by Bitcoin Per Share. But if you take into account cash growth and the structure of obligations, it does not necessarily look negative.
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Saylor is confident that a well-capitalized company with bitcoin reserves can eventually outperform BTC itself, if asset growth exceeds financing costs.
Analysts Debate Strategy’s Balance Sheet
Even after Saylor’s explanations, there is no consensus in the market.
Chief Investment Officer Lekker Capital Quinn Thompson criticized the new stock offerings. In his view, Strategy should have strengthened its balance sheet rather than using raised funds to buy more bitcoin.
Thompson believes that, taking into account debts and preferred shares, common MSTR shares trade at about 0.8 times net asset value.
He described the situation as follows: the company sells MSTR shares for 80 cents on the dollar to buy assets worth one dollar.
In his view, the question is not whether the new shares improve creditors’ position. The main thing is whether ordinary shareholders benefit if a company with negative cash flow depends on the capital markets to service debts, pay preferred share dividends, and make further BTC purchases.
A similar view was expressed by Coin Bureau Head Nick Pakhrin. He believes that Strategy has fewer and fewer simple solutions left if its shares trade below the value of its bitcoin holdings.
A new issue of common shares reduces the amount of BTC per share. Issuing preferred shares increases future obligations. Selling bitcoins could hurt market confidence. And stopping dividends could scare off preferred shareholders.
But there is another point of view. Director of Bitcoin Strategy at Metaplanet Dylan LeClair believes that even after deducting debts and preferred shares, Strategy‘s common equity can trade at a premium.
In his view, the value of Strategy‘s business is higher than the net value of its bitcoin reserves. Therefore, issuing common shares can improve the capital structure. It can increase net asset value in dollars per share and reduce debt load, even if Bitcoin Per Share temporarily declines.
Independent analyst Adam Livingston also supported Saylor’s broader approach.
According to his calculations, the latest deal looks positive if you consider not only the bitcoins bought but also the growth of the dollar reserve.
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Livingston calculated that buying 1,587 BTC along with adding about $100 million to the reserve added about 3,146 BTC in equivalent to the residual value for common shareholders.
As a result, Common Equity Bitcoin Exposure rose from 145,142 to 145,319 satoshis per share.
He put it simply: if you look only at BTC, the deal looks dilutive. If you consider BTC together with cash, the effect is positive.
This matches Saylor’s position. Ordinary shareholders own not just the latest batch of bitcoins purchased, but the residual share of Strategy‘s entire balance sheet after accounting for debts, preferred shares, and other senior claims.
The Main Test for MSTR Is Market Trust
The debate around Strategy shows that investors have started to look at its model differently.
When bitcoin was rising, the scheme seemed clear: raise capital, buy BTC, and trade at a premium to reserve value.
Now the market is tougher. Bitcoin’s drop has reduced that premium. At the same time, debts, preferred dividends, and future capital needs have become much more important for evaluating the company.
That’s why the $100 million purchase got so much attention, even though for Strategy it’s not the largest amount.
On the one hand, BTC Yield fell again, strengthening the arguments about shareholder dilution. On the other hand, cash reserves grew, and Saylor can claim that the overall residual value for common shareholders has increased.
Now the main question is not whether Strategy can keep buying bitcoin. As long as capital markets are open, the company can continue this strategy.
What matters more is this: will investors continue to believe in this model if bitcoins per share keep dropping, even as the total amount of BTC on Strategy‘s balance sheet keeps growing?
