Today, Strategy announced that it has increased its USD reserve to $2.19 billion.
Here's why this is so important:
Let's first understand the debt structure of Strategy.
Any convertible debt of Strategy won't mature before September 2028.
Also, the interest rate on these debt is merely 0.42%
But there's another side of Strategy debt structure.
Strategy has launched several instruments to increase its BTC accumulation.
The holders of these instruments get paid 8%-11%, which is pretty high.
The 4 instruments Strategy has launched are STRD, STRK, STRC, and STRF.
If calculating the yearly dividend payment from these 4 instruments, it comes around $698.48 million.
The biggest fear was that if BTC continues to drop, Strategy will have to sell their holdings for dividend payments.
Saylor stopped this FUD when he announced a USD reserve of $1.44 billion.
But the market was not fully convinced.
What if BTC doesn't hit a new ATH before 2028?
Now, Strategy doesn't care.
After increasing their USD reserve to $2.19 billion, Strategy could pay the dividend for 3+ years without selling a single BTC.
And historically, BTC has made a new ATH in the halving year.
So if 4-year cycle is intact, Strategy is all good.
If a supercycle happens, Strategy will be even better.
