Strive Buys 3,311 BTC for $280M and Plans $500M SATS Preferred

Strive, a publicly traded bitcoin treasury company, bought 3,311 BTC for roughly $280 million in the week ending Oct. 9. That lifts its balance to 32,773 Bitcoin, which industry data ranks as the fifth-largest holding among public companies. Strive disclosed the purchase on Tuesday in a filing with the SEC.

Right after the report, the company announced a second preferred share class worth $500 million. Here is where the capital comes from and how the model differs from Strategy's.

The largest purchase since January

The average entry price was about $84,500 per coin. On Tuesday bitcoin traded near $83,300, so the fresh batch sits about 1.4% under water. That does not stop the stack from being worth around $2.7 billion.

The pace is clearer over a longer stretch. Three months ago Strive held under 20,000 BTC, today it holds 32,773. That is more than 12,700 coins added, or over 60% in a quarter. Last week alone the stack grew 11.2%, from about 29,460 BTC.

ASST shares barely moved and stayed near $27.5.

Where the money came from: $208 million in warrants

Chairman and CEO Matt Cole said investors exercised $208 million in warrants. That covers about 74% of the purchase. Roughly 15.3 million warrants were still unexercised a day before they expired. Available reports do not break down where the remainder came from.

Separately, Strive amended its governing documents to set a binding $100 minimum issuance price for its SATA preferred shares. The company can no longer issue them below that mark. SATA traded at $99.40 on Tuesday, slightly under par, so the protection for current holders is practical rather than cosmetic.

SATS: a second preferred share class

According to CoinDesk, Strive plans to sell 5 million SATS shares at $100 each, raising $500 million. The dividend is fixed at 15% a year and paid daily. SATA pays a variable rate, currently 13%.

SATS rank below SATA in the payout queue, which is why the rate is higher. Proceeds will go to more bitcoin, income-producing assets or stock buybacks.

There is one more condition. At closing, Strive will set up a reserve covering the first 18 months of dividends. By simple arithmetic that is about $112 million, more than a fifth of the whole offering. The annual payout alone would be $75 million if the issue sells out.

Bitcoin per share is growing faster than the share count

The metric that matters for these companies is not the size of a purchase but the amount of bitcoin behind each share. Over the week, holdings grew 11.2% against a 9.4% rise in the effective common share count. The gap is small, about 1.6% per share, but it is positive, unlike at some peers.

Strategy, which pioneered the model, added only 250 BTC in the same week and holds 848,250 BTC. That is roughly 26 times Strive's stack. So the smaller company is growing faster, though its absolute weight is modest: under 4% of Strategy's position.

"Strive is turning demand for digital equity (ASST) and digital credit (SATA) into demand for Bitcoin. Its hypergrowth shows how the capital markets are accelerating Bitcoin adoption."

- Michael Saylor, executive chairman of Strategy, from a post on X about the Strive purchase

What could break the math

The model works while the market is willing to buy both the common stock and the preferred paper. A few places where it can fail.

• Dividends on SATA and SATS have to be paid daily, and SATS alone add $75 million a year if fully placed.
• If SATA stays below $100, new issuance is blocked by the charter, and the funding source narrows.
• Bitcoin price: the latest batch was bought above the current rate, and a few more percent of decline would put the whole batch in the red.
• SATS rank behind SATA in priority, so if trouble comes, holders of the new issue are paid later.

Bottom line

In a quarter Strive added over 12,700 BTC, in a week it pulled in $208 million through warrants, and it is preparing another $500 million through SATS. Bitcoin per share is still rising. The next test is whether there is enough demand for the higher-rate paper now that the warrants have run out.