MicroStrategy Launches New Bitcoin-Linked Stock Product
NEW IPO: STRC
The business intelligence software company, now rebranded as Strategy, has announced an initial public offering (IPO) for its new stock, Stretch (STRC).
Key Details
- Plans to sell 5 million shares at an expected $100 each, raising approximately $500 million.
- The net proceeds, along with general corporate purposes, will be directed towards acquiring Bitcoin.
- Investors who buy STRC stock will receive an initial dividend rate of 9%.
- Unlike previous offerings, STRC will offer a variable monthly dividend.
Driving Force: Bitcoin Acquisition
Strategy, formerly known as MicroStrategy (MSTR), stated its primary intent is to use the funds from the STRC IPO to further bolster its substantial Bitcoin treasury. The company recently acquired its 600th-thousandth Bitcoin, significantly adding to its holdings worth over $71 billion at the current Bitcoin price.
The firm already offers several other stock products (STRK, STRF, STRD) listed on Nasdaq. STRC’s unique structure—paying a variable dividend—instantiates Strategy’s evolving financial model.
A Shift from Software to Crypto
Although originating as a business software provider, Strategy began accumulating Bitcoin in early 2020 as a hedge against inflation. Its stock performance has dramatically shifted, up by over 2,800% since 2020.
Executive Chairman Michael Saylor championed the Bitcoin strategy; he believes adopting a Bitcoin treasury offers companies exposure to this asset class and has encouraged other firms to follow suit, a trend now seen across the S&P 500.
Context: Ambitious Bitcoin Funding Goals
Strategy previously had a plan to raise $42 billion by 2027 for Bitcoin purchases. However, in May of this year, the company significantly increased its financial target to raise $84 billion by the same deadline.
Recent actions signal an aggressive focus on Bitcoin: as of late July, the company’s market capitalization hit a record high.
