Strategy launches $1.44 billion dividend payment reserve amid boost in Bitcoin holdings

• Strategy has created a USD reserve of $1.44 billion to support dividend payments.
• The company aims to cover 24 months of dividends through its reserve.
• Strategy also revealed it purchased 130 BTC for $11.7 million, pushing its digital asset holdings to 650,000 BTC.

Strategy announced that it has established a US Dollar (USD) reserve of $1.44 billion to support dividend payments. The company also revealed an additional purchase of 130 BTC for $11.7 million, pushing its total digital asset holdings to 650,000 BTC.

Strategy announces $1.44 billion dividend reserve

Bitcoin treasury and financial intelligence firm Strategy (formerly MicroStrategy) has expanded its holdings again. The firm purchased 130 BTC for roughly $11.7 million between November 17 and November 30, according to an 8-K filing with the US Securities and Exchange Commission (SEC) on Monday. 

The company executed the latest purchase at an average price of $89,960 per Bitcoin. The filing shows that Strategy's total Bitcoin stack has now risen to 650,000 BTC, valued at about $55 billion at current prices. The company's overall acquisition cost stands near $48.4 billion, reflecting an average purchase price of $74,436 per BTC, inclusive of fees and related expenses.

Strategy's latest purchase comes amid Bitcoin's sustained volatility, as the top crypto dropped 7% from $90,000 to $84,500 on Monday.

The filing also revealed that Strategy has created a $1.44 billion US Dollar reserve to support dividend payments on its preferred stock and interest on its outstanding debt obligations. The company funded the reserve through proceeds from its at-the-market stock offering program.

USD reserves serve as a stabilizing mechanism, ensuring companies can meet dividend commitments even when operating cash flows dip.

Strategy aims to keep the reserve large enough to cover at least 12 months of dividend and interest payments, with a long-term goal of expanding it to provide 24 months or more of coverage.

"The maintenance of this USD Reserve, as well as its terms and amount, remain subject to Strategy's sole and absolute discretion and Strategy may adjust the USD Reserve from time-to-time based on market conditions, liquidity needs and other factors," the company wrote in the filing.

Strategy's MSTR stock is down 6% on Monday, following a downturn in cryptocurrencies and crypto-related stocks.