The open market repurchases were initiated by Strategy last week, from July 20 to 26 2026. They purchased 288,930 STRC shares at an average cost of $86.52 for approximately $25 million. Noteworthy, the company continued to increase its cash reserve and did not buy any Bitcoin.
Why is this happening? Why does the biggest Bitcoin Treasury Company buy back its own credit?
Context
STRC’s earnings in June 2026 were far less than the stated $100. These two articles provide a detailed analysis on what actually happened.
In response to Strategy’s Digital Credit Capital Framework that was announced on 29 June, the STRC bought back last week. June volatility. The company authorized repurchases of up to one billion dollars across STRC and STRF. STRC, which is considered Strategy’s flagship products now, was the first priority of these buybacks.
MSTR’s common stock is the starting point for the logic behind the buyback. The common stock owns any remaining value once all claims are satisfied. BTCs and cash from Strategy are the company’s liquid assets. MSTR is positioned ahead of debt and preferred stocks. Strategy’s USD Reserve, or cash, offset a portion of these senior claims. Common Stock represents value after debt and preferred shares are subtracted from Bitcoin Reserve and added back to available cash.
The Strategy is the recently launched product. “Net Bitcoin Per Share” metric. Strategy calculates net BTC using its current method by subtracting from bitcoins held the equivalent bitcoin value of convertible debt, debt-like securities, and perpetual preferred shares outstanding, before adding back USD Reserve. This is the exact same paragraph as before!
Divide Net BTC by the fully-diluted shares of common stock to get Net BPS. Strategy discloses that it has set July 23rd as the limit for its new mNAV formula, which uses net BPS as the denominator.
This gives MSTR shareholders a clear view of the BTC attributable economically to equity, after senior claims. When Strategy sells more debt or preferred shares to purchase bitcoin, the Gross Bitcoin per Share may increase. Net Bitcoin per share captures all the liabilities created by the purchase of bitcoin, and answers the question as to how much bitcoin is left for ordinary shareholders after senior investors are paid.
The Net BPS framework provides an effective way to measure the impact of capital market transactions in MSTR. Investors can use it in conjunction with other metrics.
Why STRC Buybacks, you ask?
It is true that retiring liabilities under their notional value is positive on a BTC net basis.
To understand basic mechanics, let’s look at a simple balanced sheet.
Let’s say a company has $100 million in BTC but also owes $50 million to senior creditors. The common equity claim is a residual $50 million claim.
$100 million assets – $50 million liabilities = $50 million equity
Let’s say the company is able to retire these $50 million in liabilities by paying $40 million. After using $40 million from its assets, the company has $60 million in assets and no remaining liabilities. Common equity increases from $50 to $60 millions.
$60 million assets – $0 liabilities = $60 million equity
Equity claims went up from $50,000,000 to $60,000,000. Spending $40 million on a claim of $50 million creates value worth $10 million for the remaining owner.
STRC’s repurchase structure is the same. A security that had a stated $100 amount was retired by paying an average $86.52 for the strategy. The repurchased shares removed $100 of the preferred stock claim that was used to calculate the Net BTC for the company, while only consuming $86.52 in capital. MSTR receives a gross increase of $13.48 from the spread.
According to the average reported price, Strategy returned $28.893 of STRC’s stated amount. This amounts to about $24.998 billion. MSTR receives the difference of approximately $3.895 millions.
The current STRC annualized rate of dividends is 12%. The annual dividend requirement is reduced by approximately $3.47million when STRC’s stated amount of $28.893million is withdrawn. Since STRC remains below $100 the dividend is also likely to be increased. The actual cost of the annual dividend is therefore likely higher.
The conclusion of the article is:
The Net BTC is the BTC that remains in the stock after all senior obligations are taken into account. STRC is buying back shares to boost the Net BTC metric per share of the company.
Disclaimer: This material was produced on behalf of Bitcoin For Corporations This is only for informational use. This article is based on the author’s analysis and opinions and shouldn’t be taken as an investment recommendation. This article does not constitute an invitation or offer to buy, sell or subscribe any financial products or securities.
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Source: bitcoinmagazine.com
