Key Takeaways
- Strive has now become one of the largest corporate holders of Bitcoin, surpassing Galaxy Digital.
- The company acquired 7,525 BTC for approximately $162 million bought directly from the open market.
- This strategic acquisition was funded by proceeds from Strive’s recent oversubscribed initial public offering of perpetual preferred stock.
- Strive CEO Matt Cole highlighted this method as an innovative model for corporate Bitcoin acquisition without diluting common stockholders.
- The company’s SATA preferred stock is designed to offer a predictable yield while enabling Strive to grow its Bitcoin treasury.
Strive Overtakes Galaxy Digital in Bitcoin Holdings
Strive has emerged as a significant player in corporate Bitcoin ownership, now holding more BTC than Galaxy Digital. The asset management firm recently expanded its holdings by acquiring an additional 7,525 Bitcoin directly from the open market, at a total cost of roughly $162 million.
This latest transaction positions Strive ahead of Mike Novogratz’s Galaxy Digital, which currently holds approximately 6,894 BTC, according to available data.
The competitive accumulation of Bitcoin by publicly traded companies underscores a growing trend of viewing Bitcoin as a vital treasury asset. This institutional interest is amplified by ongoing fluctuations in monetary policy and a broader global search for robust digital reserves.
Strive Utilizes IPO Funds to Expand Bitcoin Treasury
The capital for this substantial Bitcoin purchase was derived from Strive’s recent initial public offering (IPO) of SATA noncumulative perpetual preferred stock. The offering, priced at $80 per share, was oversubscribed and subsequently upsized, indicating strong demand from institutional investors.
In a company announcement, Strive CEO Matt Cole described the use of perpetual preferred equity, as opposed to common stock or corporate debt, as an innovative model for corporate Bitcoin accumulation. This approach allows Strive to grow its Bitcoin portfolio without diluting the equity of its common stockholders.
Cole emphasized that this was a critical juncture for the company, and its success in utilizing perpetual preferred equity for Bitcoin acquisition marks a pioneering step. He believes this strategy demonstrates Bitcoin’s potential as a stable foundation for long-term value creation.
The trend of corporate Bitcoin acquisition is visible across various sectors. Companies such as CleanSpark, Trump Media and Technology Group, and Tesla have recently increased their Bitcoin holdings. Furthermore, institutional investment in Bitcoin ETFs and other structured products continues to rise, with reports suggesting significant allocations, such as JPMorgan’s potential investment in BlackRock’s BTC ETF.
Strive has indicated that it may pursue further Bitcoin acquisitions, provided that market conditions remain favorable for its corporate treasury strategy. This proactive approach aligns with a growing global interest in Bitcoin-backed corporate structures.
SATA’s Dividend Strategy Offers Attractive Returns
The SATA preferred shares are structured to provide an adjustable payout, designed to yield approximately 12% annually, referred to as the Return of Capital (ROC). This structure offers potential tax advantages for investors. Strive plans to adjust the dividend rate to maintain the stock’s trading price between $95 and $105 per share.
Ben Werkman, Strive’s CIO, characterized SATA as a financial instrument that combines the stability of conservative fixed income with the capital efficiency of Bitcoin, often referred to as dollarization. This design aims to provide investors with a predictable yield while supporting Strive’s ongoing Bitcoin treasury growth.
Jeff Walton, the company’s Chief Risk Officer, highlighted Bitcoin’s liquidity, transparency, and 24/7 global trading as key advantages for treasury-backed yield strategies. He added that Bitcoin’s established market structure and historical performance allow Strive to more effectively model risk and return compared to many alternative assets.
With its latest acquisition, Strive now ranks among the top corporate Bitcoin holders, positioned just below GD Culture Group and ahead of Galaxy Digital. The company’s rapid growth reflects its distinct strategy of integrating Bitcoin into its core capital formation model.
Given the increasing popularity of corporate Bitcoin strategies worldwide, Strive’s innovative approach is likely to attract attention from both traditional market participants and those within the cryptocurrency space.
Final Thoughts
Strive’s recent acquisition of 7,525 Bitcoin has propelled it to become one of the largest corporate holders of the digital asset, surpassing Galaxy Digital. This strategic move, funded through an innovative IPO structure, reflects a growing trend of institutional adoption of Bitcoin as a treasury asset.
The company’s unique SATA preferred stock offering provides a stable yield for investors while allowing Strive to continuously expand its Bitcoin reserves. This innovative model highlights Strive’s commitment to leveraging Bitcoin for long-term value creation and its proactive stance in the evolving landscape of corporate digital asset holdings.
