US Company Acquires Convertible Bonds at 8% Discount and Adds 20,000 Bitcoins

Strategy Inc. (Ticker: MSTR) disclosed that between May 11 and 25 it repurchased $1.5 billion of zero-coupon convertible notes due 2029 for approximately $1.38 billion—about an 8% discount to par—and, in parallel bitcoin-related trades, realized profit equivalent to roughly 4,331 bitcoins and recorded $333 million in mark-to-market gains. To support this capital restructuring and further bitcoin acquisitions, the company issued about $2 billion of floating-rate Series A perpetual preferred shares (STRC) and $84 million of Class A common stock, then purchased 24,869 bitcoins, bringing its total holdings to 843,738 bitcoins.

Strategy reaffirmed that, under U.S. tax law, dividends on its preferred shares will be treated as a non-taxable return of capital in the absence of retained earnings for the foreseeable future. The company also disclosed additional details on the methodology and limitations of its proprietary metrics for tracking bitcoin holdings and profitability.

Meanwhile, director Jarrod M. Patten executed several “exercise-and-sell” transactions in late April and early May, exercising a portion of long-held stock options and selling a substantial number of the resulting shares in the open market. After these trades, he retains 28,000 shares of Class A common stock, various Series A perpetual preferred shares and the remaining stock options.

In its early-May earnings release, Strategy reported bitcoin holdings of 818,334 coins and has since updated its capital-markets activities—additional purchases and early note repurchases—through subsequent SEC filings. Its subsidiary-style preferred stock STRC has achieved a market capitalization exceeding $10.5 billion in under ten months, ranking it among the world’s largest preferred issues.

Headquartered in Virginia, Strategy Inc. is a software and business-intelligence firm that rebranded from MicroStrategy and has positioned itself as a “bitcoin treasury company” through large-scale bitcoin purchases. It is now recognized as the publicly traded company holding the most bitcoins globally. Alongside its common shares (MSTR), the company issues multiple series of perpetual preferred shares—STRC, STRK, STRD and STRF—and debt-linked instruments, offering investors varied exposure to bitcoin price movements. This hybrid structure is drawing attention as an innovative example of integrating digital assets with traditional capital markets.