Shares of Strategy Inc. (NASDAQ: MSTR) climbed 7% on Monday after the company announced a comprehensive change to its corporate capital strategy. The new Digital Credit Capital Framework signals a departure from the firm’s previous ‘‘one-way’’ emphasis on acquiring Bitcoin and introduces a deliberate program of securities repurchases and structured monetization of cryptocurrency holdings.
The framework authorizes up to $2.0 billion for buybacks split across two buckets: as much as $1.0 billion to repurchase Class A common stock and up to $1.0 billion earmarked for repurchases of the company’s Digital Credit Securities. Management described the shift as a move toward active capital management, allowing the company to both issue and repurchase securities depending on market conditions.
CEO Phong Le summarized the change by saying the company will oscillate between issuing securities when capital is favorable and buying back securities when they trade at levels that make repurchases accretive. That statement frames the new policy as a flexible tool designed to respond to valuation and capital market dynamics.
Alongside the buyback authority, Strategy approved a structured approach to selling Bitcoin. While the company retains the power to sell units from its holdings, the Board imposed explicit limits on how proceeds from any Bitcoin sales may be used. The Board specified three permissible uses: funding securities buybacks, paying dividends or interest on preferred stock, and building the company’s USD Reserve.
To support liquidity planning and coverage of fixed obligations, the company established a formal ``12-month'' safety cushion policy for its USD Reserve. The policy requires that the reserve maintain a balance sufficient to cover at least 12 months of expected preferred dividends and interest expense. At the time of the announcement, the USD Reserve stood at $2.55 billion, which the company said represents 17.4 months of coverage against its stated $1.76 billion in annual preferred dividends and interest obligations.
In a related change affecting the company’s preferred security holders, Strategy increased the regular dividend rate on its Variable Rate Series A Perpetual Stretch Preferred Stock (NASDAQ: STRC) to 12.00% per annum. The company also indicated that this rate will be reviewed monthly and adjusted based on observable factors including market yields, credit spreads and Bitcoin volatility, reflecting the firm’s intent to tie the preferred coupon more closely to prevailing financial conditions and digital-asset market behavior.
Despite the new authority to monetize portions of its cryptocurrency holdings, Strategy remains one of the largest corporate holders of Bitcoin. The company reported holding 847,363 Bitcoin as of June 28, 2026, purchased for a cumulative $64.10 billion, which equates to an average acquisition cost of $75,651 per Bitcoin.
Market participants reacted positively to the package of measures, welcoming the additional tools to support the equity during periods of market stress. The buyback authorization, in particular, was viewed as a mechanism that could be used to defend the stock price when the company’s securities trade at levels management deems accretive.
Summary
Strategy Inc. announced a Digital Credit Capital Framework that transitions the company from a strict Bitcoin accumulation model to an active capital management approach. The plan includes up to $2.0 billion in buybacks, a controlled program for Bitcoin sales with tightly defined uses for proceeds, a formal USD Reserve policy requiring at least 12 months of coverage, and an increase in the regular dividend rate on its Variable Rate Series A Perpetual Stretch Preferred Stock to 12.00% per annum.
Key Points
- Strategy authorized up to $1.0 billion to repurchase Class A common stock and up to $1.0 billion to repurchase Digital Credit Securities.
- The Board limited proceeds from any Bitcoin sales to three specific uses: securities buybacks, preferred dividends/interest, and capitalizing the USD Reserve.
- The USD Reserve policy requires at least 12 months of coverage; the reserve is $2.55 billion, equal to 17.4 months against $1.76 billion in annual obligations. The preferred dividend on STRC was raised to 12.00% per annum and will be reviewed monthly.
Risks and Uncertainties
- Bitcoin market volatility is a factor in monthly reviews of the STRC dividend rate, introducing uncertainty for preferred holders and the company’s interest expense profile.
- Execution risk exists around any planned Bitcoin monetization because proceeds are restricted to certain uses, which could limit flexibility in applying liquidated crypto proceeds.
- The effectiveness of buybacks to support the stock depends on market prices and management judgment about accretive repurchases, creating uncertainty about the timing and scale of repurchase activity.