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.
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