Strategy cuts net leverage to near zero as cash nearly matches convertible debt
A major Bitcoin treasury company is adjusting its capital structure by reducing net leverage and bolstering its U.S. dollar reserves. The strategy aims to support dividend payments and debt obligations while maintaining a significant Bitcoin reserve.
Why it matters
Corporate treasury management of Bitcoin is becoming increasingly sophisticated, with firms balancing debt, cash, and digital assets to maintain financial stability.
The company calculates net leverage by subtracting its dollar assets from its debt of about $6.75 billion and dividing the remainder by the value of its bitcoin reserve, currently around $66 billion.
Over recent months, Strategy has largely focused on raising capital to bolster its U.S. dollar reserve, which supports approximately $1.7 billion in annual preferred-stock dividends. The reserve has grown to $5.1 billion, covering about four years of dividend payments. It also established a $1.59 billion cash pool , which can be deployed more flexibly.
“USD Cash enhances our Digital Credit Capital Framework, and is separately designated for general Bitcoin Treasury Company purposes, including acquiring BTC, paying preferred dividends & interest, repurchasing MSTR/preferred stock, repaying converts, and increasing USD Reserve,” Executive Chairman Michael Saylor said in a Friday post on X.
Get smarter about the news
Sign up free for a feed built around what you actually care about, Dive Deeper research on any story, and the full text of every article.
Create free accountAlready have an account? Sign in