Strategy pauses Bitcoin buying, builds cash reserves

Investing.com -- Michael Saylor’s Strategy Inc. has temporarily halted Bitcoin purchases while increasing its cash reserves to $2.19 billion, potentially preparing for an extended cryptocurrency market downturn.

The Tysons Corner, Virginia-based company raised $748 million through common share sales in the week ending December 21, according to a Monday filing with the US Securities and Exchange Commission. This pause follows approximately $2 billion in Bitcoin purchases over the previous two weeks, which brought the company’s total holdings to around $60 billion.

Earlier in December, Strategy established a $1.4 billion reserve specifically designated for future dividend and interest payments, addressing concerns that the company might be forced to sell Bitcoin if prices continue declining. Bitcoin has fallen about 30% since reaching its all-time high in early October, while Strategy’s shares have dropped more than 50% during the same timeframe.

The company’s mNAV, a key valuation metric comparing enterprise value to Bitcoin holdings, stood at approximately 1.1 on Monday, according to Strategy’s website. This figure indicates ongoing investor concerns that the metric could soon turn negative, having previously commanded a significant premium.

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