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Strive secured $55 million this week, resulting in 638 more bitcoins in its reserves. However, behind this seemingly impressive figure lies a tangible issue beginning to surface.
Why It Matters
The challenges faced by Strive highlight a broader concern within the crypto investment landscape, particularly around funding models that depend heavily on maintaining high share prices. As the market fluctuates, companies like Strive may encounter difficulties in sustaining their acquisition strategies, which could impact their ability to accumulate bitcoin and influence overall market dynamics. This situation underscores the potential vulnerabilities of similar financing approaches in the volatile crypto environment, raising questions about their long-term viability and the stability of assets held by such firms.
Strive’s financing mechanism revolves around SATA preferred shares—a model roughly based on what Michael Saylor built with Strategy. The concept is simple: sell shares, use the funds to buy bitcoin. This works well as long as the SATA shares trade above $100. Below that, the “at-the-market” issuance program halts. And that’s exactly what happened this week—the shares slipped below this threshold on Wednesday, halting further possible issuances. Not ideal for a company that bets everything on continuous accumulation.
Between September 25 and October 2, Strive managed to issue over 1.3 million preferred shares, with a total value exceeding $130 million. That’s significant.
The Hidden Cost of SATA Issuances
Each issued share comes with future dividends to honor. And these accumulate quickly. By the end of September, Strive’s dividend obligations were estimated at $168.2 million per year. It’s the price of speed—accumulating bitcoin rapidly is costly in future commitments, and these commitments don’t disappear if the market turns sour.
Strive’s bitcoin portfolio is currently valued at approximately $2.34 billion. But the average acquisition cost per unit is $90,170. If bitcoin falls below this level, the book value of the assets drops below the purchase cost—and then, investor questions will become more pressing. The company also recently bought 2,000 additional bitcoins at around $84,422 each, slightly lowering the average cost but not enough to eliminate the risk.
As of the end of September, Strive held a total of 28,000 bitcoins. The 638 acquired this week are thus an estimate, not yet officially confirmed—the precise figure will be in the next regulatory filing.
No comment from Strive on alternative financing options. Nothing public, at least.
Strive vs Strategy: Same Logic, Different Models
Saylor’s company, Strategy, primarily relies on common shares to finance its bitcoin purchases. Strive, however, depends almost entirely on SATA preferred shares. This is where the two models really diverge. With common shares, there’s no minimum price threshold blocking issuances. With SATA, if the price falls below $100, the tap shuts off. Period.
Saylor himself sees Strive more as a partner than a competitor—that’s what the source says. But it doesn’t change the operational reality: Strive is more exposed to stock market whims than Strategy on this specific point.
The October 5 SEC filing shows that Strive managed to issue a significant volume of shares before the price dropped. It looks like anticipation, or maybe just lucky timing—hard to say.
If the SATA doesn’t climb back above $100, Strive will likely have to seek other avenues to continue buying bitcoin. Which ones? Not clear at the moment. The company hasn’t communicated publicly about this. Investors are waiting for the next official reports for a clearer picture.
What is certain: the model works well when markets cooperate. When they don’t, the dependence on this $100 threshold becomes a real burden. And bitcoin at $84,422 on the latest purchases is below the overall average cost of $90,170—so Strive is currently accumulating at a paper loss, betting on a future price increase.
The $168.2 million in annual dividends to be paid remain, regardless of what happens to the price of bitcoin.
Hub: Bitcoin: Price, News and Analysis
Frequently Asked Questions
How many bitcoins does Strive hold in total after these purchases?
As of the end of September, Strive held 28,000 bitcoins. The 638 acquired this week are an estimate pending confirmation by official filing.
Why is the $100 threshold critical for Strive’s financing?
The SATA preferred share issuance program can only operate if the price remains above $100. Below that, Strive can no longer raise new funds through this mechanism to buy bitcoin.
What is Strive’s average bitcoin acquisition cost?
Strive acquired its 28,000 bitcoins at an average cost of $90,170 per unit. The latest purchase of 2,000 bitcoins was made at approximately $84,422 each.
