Strategy flips BlackRock Bitcoin holdings as traders ‘sell the news’
Strategy, the Michael Saylor-led company formerly known as MicroStrategy, has surpassed BlackRock’s flagship spot Bitcoin exchange-traded fund (ETF) to become the world’s largest institutional holder of Bitcoin.
According to an April 20 regulatory filing with the Securities and Exchange Commission (SEC), Strategy acquired an additional 34,164 Bitcoin over the past week at an average price of $74,395 per coin.
The purchase cost about $2.54 billion and ranks as the third-largest single acquisition in the company’s history by coin count.
The latest transaction lifted Strategy’s total Bitcoin holdings to 815,061 BTC, or about 3.88% of the token’s total supply.
The company has spent about $61.56 billion building that position, giving it an average cost basis of $75,527 per coin. With Bitcoin trading at around $75,000, the firm’s holdings are worth roughly $61.2 billion, leaving the portfolio with an unrealized loss of more than $228 million.
Strategy’s Bitcoin holding flips BlackRock IBIT
Meanwhile, the scale of the latest purchase is notable even on a standalone basis. The 34,164 Bitcoin acquired this week alone would rank a company as the fifth-largest corporate holder in the world.
That haul was enough to push Strategy past BlackRock’s iShares Bitcoin Trust (IBIT), the world’s largest Bitcoin fund. IBIT currently holds 798,026 Bitcoin after previously overtaking Strategy in the first quarter of 2024, following the approval of spot Bitcoin ETFs in the United States.
The comparison is significant because the two vehicles represent different forms of Bitcoin exposure. BlackRock’s fund holds Bitcoin on behalf of retail and institutional investors through a regulated Wall Street structure.
Strategy, by contrast, is a publicly traded operating company that has increasingly turned itself into a leveraged BTC treasury vehicle, using debt and equity markets to expand its reserves.
Against that backdrop, the only entity widely believed to hold more Bitcoin remains the network’s pseudonymous creator, Satoshi Nakamoto, whose inactive wallets are estimated to contain about 1.1 million coins.
Meanwhile, Strategy Chief Executive Officer Phong Le said the latest purchase increased the company’s Bitcoin yield by 82% to $4.97 billion for the year in just one week.
He said the result demonstrated the reflexive power of combining an appreciating digital asset with accretive debt financing.
Analysts tracking the company’s pace of accumulation have projected that Strategy could reach the 1 million Bitcoin mark before the end of the year.
STRC becomes central to the model
The latest purchase also underlined how heavily Strategy now relies on its preferred securities to fund its Bitcoin strategy, without relying too heavily on common-share dilution.
According to the filing, the company’s perpetual preferred security, known as Stretch, generated $2.18 billion last week, accounting for roughly 85.7% of the proceeds used to purchase the security.
Notably, STRC also financed all of Strategy’s $1 billion Bitcoin buy for the week ending April 12. STRC is designed to trade near a $100 par value and offers investors a variable dividend with an annualized rate of 11.5%. The dividend resets monthly.
Strategy executives have previously said that the structure is meant to keep the stock trading close to par while limiting sharper swings in valuation.
In practice, Stretch has become a core part of the company’s funding machinery, with the Saylor-led firm acquiring nearly 100,000 BTC with STRC.
As such, Strategy is no longer just a software company with a Bitcoin treasury attached. It is increasingly a Bitcoin acquisition vehicle funded through a stack of public-market instruments, including common equity, preferred stock, and other securities.
The company has said it uses proceeds from equity and debt financings, along with cash flow from operations, to accumulate Bitcoin as its primary treasury reserve asset.
A familiar pattern in the market
If the funding structure behind Strategy’s purchases has become more sophisticated, the market’s response to those announcements has remained relatively consistent.
Large Strategy purchase disclosures have often acted as buy-the-rumor, sell-the-news events for Bitcoin, rather than as immediate bullish catalysts. By the time the filing is published, traders have often already positioned for the demand.
Andre Dragosch, head of research at Bitwise Europe, said:
“Large strategy purchase announcements are historically sell-the-news events for Bitcoin. Probably countercyclical behavior because the buying is old news by the time it is announced and traders anticipate less buying next week.”
That view is supported by Bitwise Europe’s research, which shows that large acquisition disclosures from Strategy rarely translate into immediate upside after they become public. Instead, Bitcoin has historically tended to weaken in the hours following the filing.
The firm’s study of 100 Strategy Bitcoin purchase announcements since August 2020 found that the asset typically peaks about two hours before the company discloses the transaction. Once the filing is released, the price tends to drift lower.
Bitwise’s data show index performance slipping to 99.97 within 30 minutes of an announcement, then dipping to 99.96 after one hour, before attempting a partial recovery.
The size of the purchase appears to matter as well. For the top 10% of purchases by volume, which tend to attract the most market attention, Bitcoin has usually risen into the disclosure and then sold off once the news is confirmed, with weakness extending over the following two hours.
That pattern is consistent with a familiar market dynamic. Traders price in expected demand ahead of time, leaving limited room for upside once the purchase is formally announced.
Meanwhile, smaller acquisitions have tended to produce the opposite effect. The bottom 10% of Strategy purchase tranches have been associated with relatively flat price action ahead of the announcement, followed by steadier gains in the two hours after disclosure.
Considering this, Bitwise argues that quieter accumulation is less vulnerable to front-running and may therefore offer a cleaner signal of sustained demand than the company’s largest, headline-grabbing purchases.
For that reason, market analysts caution against treating Strategy’s weekly filings as a reliable short-term trading signal.
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