Michael Saylor's MicroStrategy Pauses Regular Bitcoin Purchases
MicroStrategy (MSTR) has paused its regular Bitcoin purchases for five weeks, with the last acquisition occurring in early June. During that period, it bought 520 BTC at an average price of $67,068 — higher than Bitcoin's current value as of July 29. This pause follows recent Bitcoin sales and signals a shift from its previously popularized 'flywheel' strategy. The flywheel model relied on issuing equity while trading above net asset value (NAV) to fund further Bitcoin purchases. However, with MicroStrategy now trading at a discount — around 0.6 times NAV — this approach is no longer viable. The company must also manage significant financial obligations including $1.76 billion in annual dividend and interest payments. To address these challenges, CEO Phong Le has emphasized active capital management over one-way equity issuance. MicroStrategy's current cash reserves of $3.75 billion exceed the required amount to cover at least two years of expenses. The company is evolving its business model but remains highly exposed to Bitcoin volatility and complex financial structures.
Tickers: $MSTR
Topics: Bitcoin dividend obligations stock valuation treasury strategy