Strategy ( MSTR ) raised $2 billion but didn't buy any bitcoin ( BTC-USD ) last week. Scott Melker discusses the details in the video above.
Strategy earmarks 1.6 billion cash pool for Treasury operations buybacks. I was not going to talk about strategy again today. I'm lying. I was going to talk about strategy again today, but it gave us something more interesting to talk about. So first, what happened this week? Strategy sold 18.26 million MSTR shares and raised $2.01 billion. So
obviously, this is uh devaluing the shares of micro strategy, which people do not love. But what he did with it is very
very interesting. He did not buy Bitcoin. He did not sell Bitcoin. Those holdings remained at 840,447 Bitcoin. What he did do was obviously buy back some MSTRC,
add about 300 million to their protected reserve, which is the money that they're using to fund all of their obligations and dividends, you know, people wanted to see them have a runway.
But he used 1.59 billion of this as a USD cash pool. That is dry powder for
buying Bitcoin or for buying back MSTR stock or anything they want to do in their financial wizardry. But it's important that over 5 billion, well 5.1 billion now that they have raised before can only be used for those dividends and for financial obligations. This is the new money that can be used to buy Bitcoin and to buy other things. So,
we have not seen any indication beyond words that they intended to buy Bitcoin again. This is the first time that we are seeing something like that and I think that it is important. Now the question is,
knowing that they have always bought the top as he admits uh would be the case and they were forced to sell the low, why are they not taking that $1.59 billion now and just buying Bitcoin? I'm assuming because the optics of selling Bitcoin much lower and then buying it right back higher would be poor, but maybe they believe there's another dip coming where they'll be able to uh use some of this money. Now, you know,
you know, that uh we've shown many
memes of Michael Sailor over the last few months and usually they're Mega Maid from Space Balls and we talk about the fact that originally he was Mega Maid sucking up all the Bitcoin and then sadly he went from suck to blow and sold some Bitcoin. We have a new meme for him because now he's no longer sucking up Bitcoin, he's sucking up all the USD and apparently
Chat be thinks thinks that vacuums have a mouthpiece.
Just saw that. So weird. So weird. But he is not the only treasury company in the market that is doing things and that is very, very important because we also have Bitmine and Tom Lee right here. This is just an aside to this story, but it's important because while
uh, Sailor has had to sell Bitcoin and has been doing that uh financial magic to start to raise cash. Tom Lee has not stopped buying Ethereum at all. Bought 3 32,447 ETH today for $81 million. This is the company's largest weekly haul since early July. They're only 187,000 away from owning 5% of the Ethereum supply.
And interesting, they project roughly 330 million in annualized revenue just from staking that Ethereum, which is obviously something an Ethereum Treasury company can do
and that a Bitcoin treasury company cannot do. So, obviously, one treasury company here found the sell button, the other one removed it entirely. Tom Lee has not stopped buying Ethereum
and seemingly has absolutely no intention of doing so. I'm really, I'm really intrigued by what's going on with strategy. Right? I I love it because I think that they've matured, they're admitting what they are. I think that Bitcoin going from the low 60s to the high 70s or around 80 without Sailor in the market,
buying even after he sold is a huge narrative shift. I've talked about this a lot, but there was a prevailing belief that Sailor was the only buyer of Bitcoin that existed in the market and that clearly is not the case. And there was a prevailing
belief that we couldn't put in a bottom unless Michael Sailor was forced to sell a lot of Bitcoin and what he ended up doing was selling a little Bitcoin, which actually sparked the rally from around 60 to 64. And then as he's ceased to be the main character in the market, Bitcoin has continued to rally. Now, it's probably not that comfortable to be sitting
uhh in his chair or anyone who is forced to sell Bitcoin at the lows and see it go higher. We've all had that feeling where you find yourself wondering if you should be chasing a rally or waiting for the next dip and you know that probably means you'll just end up buying at 126,000, right? But uh uncomfortable position to have sold what looks like the lows if this ends up being the entire bottom of the market, now he's forced to buy back higher.