Strategy Launches "Digital Asset Capital Framework," Establishes BTC Realization Plan and Two $1 Billion Buyback Programs

BlockBeats News, June 29th. According to an 8-K filing submitted to the SEC by Strategy, the company announced the launch of the "Digital Credit Capital Framework," which includes five core components: Dollar Reserve Policy, STRC Dividend Policy Adjustment, Preferred Stock Buyback Plan, Common Stock Buyback Plan, and BTC Liquidation Plan.

Under the Dollar Reserve Policy, the reserve can only be used to pay preferred stock dividends and debt interest, and management must maintain a reserve size covering expected dividend and interest expenses for the next 12 months. As of June 28th, the Dollar Reserve balance was $2.55 billion.

Regarding the STRC dividend, the company will dynamically evaluate the dividend rate monthly, taking into account factors such as trading price, market yield, credit spread, and Bitcoin price volatility. The dividend rate will not be increased solely because the STRC trading price is below face value. The company also announced an increase in the annualized STRC dividend rate to 12.00%, effective July 1st.

On the buyback front, the company has established two $1 billion buyback authorizations, one for repurchasing preferred stocks such as STRC, STRF, STRD, STRK, and A-class common stock, with STRC being the primary target of the preferred stock buyback plan. Both buyback plans will not utilize Dollar Reserve funds.

Additionally, the company's board has authorized a BTC Liquidation Plan, allowing the company to raise up to $1.25 billion by selling Bitcoin to replenish Dollar Reserves, pay preferred stock dividends and interest expenses, or provide funds for the aforementioned buyback plans.