Saylor Says Strategy Could Create Up to $30 Billion of Digital Credit to Fund More Bitcoin

Strategy (NASDAQ: $MSTR) could create as much as $30 billion of digital credit, its term for preferred shares such as STRC, to finance more bitcoin purchases, executive chairman Michael Saylor said Thursday on the company’s third-quarter earnings call.

The $30 billion is a possible capacity, not an announced fundraising target. It highlights Strategy’s shift away from convertible debt and common-stock offerings toward preferred shares as its primary source of funding for Bitcoin purchases. Saylor told analysts the company could raise the amount using its existing balance sheet, without selling more common stock or relying on further gains in bitcoin’s price. “We could create $10 billion, $20 billion, $30 billion of digital credit,” he said. Strategy puts its digital credit at about $16 billion in notional value across ten listed securities.

Chief Executive Phong Le called issuing digital credit the company’s main way of buying bitcoin. Raising $1 billion to $2 billion in a month through STRC, he explained, would let Strategy put part of the proceeds into dollar reserves and the rest into bitcoin. Le also set a goal of doubling bitcoin per share in seven years through digital credit.

The company reported third-quarter net income of $19.53 billion, or $44.75 a share, up from $2.79 billion a year earlier. Net income attributable to common stockholders was $19.12 billion. Nearly all of it came from a $20.91 billion non-cash gain on its bitcoin, which rose 43% in the quarter. Strategy held 848,517 bitcoin as of Oct. 25, up 26% since the start of the year.

Recent activity has centered on supporting STRC, not buying bitcoin. Strategy spent $2.04 billion repurchasing about 21 million STRC shares at an average of $97.39, below the $100 stated amount. Its dollar reserves grew to $5.07 billion, enough to cover dividend and interest payments for 3.4 years. Its Bitcoin holdings remain largely unchanged from the approximately 846,000 BTC reported in late July, as the company skipped Bitcoin purchases and instead allocated $205 million toward STRC buybacks.

Le also pointed to shareholders’ approval this week of daily dividends on STRC, STRF, STRK and STRD, which begin with STRC on Nov. 1.

Shares of Strategy (NASDAQ: MSTR) are currently trading at $129.22, down from a 52 week high of $286.18.