Strategy's New Capital Plan: $2B in Buybacks, BTC Sale Up to $1.25B
Strategy announced a new capital plan including up to $1B in MSTR and $1B in STRC buybacks, a ~12% dividend, and permission to sell up to $1.25B in Bitcoin. Shares jumped 12%+ after hours, but analysts debate the risks.
Strategy (formerly MicroStrategy) has finalized a new capital plan that includes up to $1 billion in buybacks for both MSTR and STRC shares, a dividend target of approximately 12%, and an increased cash buffer to $2.55 billion. The plan also grants permission for the company to sell up to $1.25 billion worth of Bitcoin if needed.
Markets reacted positively: both STRC and MSTR surged more than 12% in after-hours trading. However, the plan has drawn scrutiny. Sceptics point to what they see as a reflexive loop — funding used to buy Bitcoin, which backs capital raising — that could reverse under stress, with some comparing the structure to Luna's collapse. Others argue the real risk isn't Bitcoin price swings but rather the company's ongoing access to capital markets.
A 3-year stress test cited in the analysis indicates that Strategy could survive a 55% Bitcoin drawdown even if capital markets remain closed, though at a significant cost to shareholders' Bitcoin-per-share ratio.
Source: Cointelegraph