Strategy Establishes $1.44 Billion Fiat Reserve and Increases Bitcoin Holdings to 650,000 BTC

Strategic Shift for Bitcoin Pioneer

Strategy has announced the establishment of a U.S. dollar reserve totaling $1.44 billion while simultaneously increasing its Bitcoin holdings to 650,000 BTC ^[1][2]. This marks a significant strategic shift for the company, which had previously relied exclusively on Bitcoin as a treasury asset.

The fiat reserve was funded from proceeds generated by the sale of Class A common stock through the at-the-market offering program ^[1]. It represents 2.2 percent of company value, 2.8 percent of equity value, and 2.4 percent of Bitcoin value ^[2].

Hedging Against Market Volatility

The reserve is primarily intended to ensure ongoing dividend payments on preferred stock and interest payments on outstanding liabilities ^[1][2]. Strategy plans to develop the USD reserve to finance dividends for the next 12 to 24 months ^[1].

"Establishing a USD reserve to complement our BTC reserve represents the next step in our evolution. We believe this positions us better for short-term market fluctuations while simultaneously enabling us to realize our vision of becoming the world's leading issuer of Digital Credit," said founder Michael Saylor ^[1].

CEO and President Phong Le added: "Strategy now holds 650,000 Bitcoin... we have established a USD reserve that currently covers 21 months of dividends" ^[3].

Response to Growing Criticism

The move comes against the backdrop of increasing criticism regarding the company's credit-financed Bitcoin strategy. Critics such as renowned goldbug Peter Schiff recently accused Michael Saylor of operating a Ponzi scheme ^[1].

Strategy also announced an additional Bitcoin purchase worth approximately $12 million at an average price of roughly $90,000. Due to the decline in Bitcoin price, the company is already recording a paper loss of $4.3 million on this recent purchase ^[1].

Revised 2025 Forecasts

Concurrently with the announcement, Strategy significantly lowered its target values for key performance indicators for 2025. The company now expects Bitcoin yield between 22 and 26 percent by year-end, with an estimated BTC price range of $85,000 to $110,000 on December 31 ^[2][3].

Based on this price range, Strategy projects operating income between minus $7.0 billion and plus $9.5 billion, as well as net income (or loss) between minus $5.5 billion and plus $6.3 billion ^[3].

Current Bitcoin Holdings

Overall, the company now holds 650,000 BTC, equivalent to approximately 3.1 percent of the maximum existing 21 million Bitcoin ^[2]. The average purchase price across all Bitcoin investments stands at $74,436, with total costs of approximately $48.38 billion including fees ^[1]. The company currently reports unrealized gains of nearly $7.51 billion ^[1].

Despite continuously increasing BTC holdings per share, Strategy's stock is in crisis. Year-over-year, MSTR stock has fallen more than 53 percent, while Bitcoin declined only 12 percent in the same period ^[1].