Ah, man... saw the Strategy announcement and was waiting for this news report.
oh, how cringe. The P continues
Back in the day when we had sane words, we used to call this "value destruction"
(I was told by a certain someone that I'm an idiot for thinking that...)
TO THE DETAILS:
Shares of Strategy tumbled after the bitcoin champion launched a US dollar reserve to fund its dividends and warned that it could incur a $5.5bn loss if the price of the cryptocurrency does not rebound this year. Strategy said on Monday it had created a $1.44bn “US dollar reserve” to fund its dividends. The reserve was financed by money raised from its share sales, and the Nasdaq-listed company said it aimed to maintain a dollar reserve that would fund “at least 12 months of its dividends”, growing to eventually cover “24 months or more” of payouts.
"Shares in Strategy were down more than 11 per cent on Monday morning, and have fallen about 46 per cent this year as investors have questioned the viability of its business model."
The company buys bitcoin by issuing shares, convertible debt and new preferred equity instruments. The move highlights how Strategy is bracing for its share price to fall even further. The company will in particular need cash to repay its $8.2bn worth of convertible debt holders if its share price does not rise.
So, the world's coolest pump-and-dump issued shares just to hold cash, so that investors aren't worried the pref dividends won't be paid. Basically, fleece the common shareholder in order to service the (institutional?) prefs. And somehow the P word is'n't appropriate yet? I don't get it.
...and it's kind of nice, actually, to see them losing the grip
archive: https://archive.md/UOw5T
Pis only applied when the otherPs feel they need the patsy. Right now, it would be bad strategy, because there is still some money to squeeze out of fools that buy into it.