Business intelligence firm Strategy has established a $1.44 billion U.S. dollar reserve. The reserve has been funded through at-the-market (ATM) sales of its MSTR stock.
This reserve is specifically intended to cover dividend payments on its preferred stocks and interest on existing debt.
Unsurprisingly, the idea of establishing a USD reserve did not sit well with some Bitcoin maximalists. Some argue that holding substantial BTC reserves contradicts the company’s “Bitcoin maximalist” mantra.
That said, the creation of the reserve should potentially assuage investor concerns about Saylor potentially having to sell Bitcoin. The USD reserve is sufficiently big to cover 21 months of payments.
Major Bitcoin milestone
The total Bitcoin holdings of business intelligence firm MicroStrategy have now surpassed 650,000 coins.
Its most recent purchase of 130 BTC (roughly $12 million at current prices) finally allowed the company to surpass the aforementioned milestone.
Strategy announced its first BTC purchase back in August 2020.
“The beginning of the end”
In the meantime, gold bug Peter Schiff claims that this is the beginning of the end for Strategy in response to the establishment of the dollar reserve.
“Today is the beginning of the end of $MSTR. Saylor was forced to sell stock not to buy Bitcoin, but to buy U.S. dollars merely to fund MSTR's interest and dividend obligations. The stock is broken,” he said.
The company’s stock is getting clobbered following the announcement, which comes after yet another Bitcoin price correction.
Dan Burgin
Vladislav Sopov
U.Today Editorial Team
