Connect with us

Crypto World

Strategy to issue more preferred stock to reduce volatility

Published

on

Strategy says BTC would need to fall to $8K to strain debt

Strategy is turning to preferred stock to keep buying Bitcoin while easing pressure from market swings.

Summary

  • Strategy is issuing more preferred shares to fund Bitcoin purchases.
  • The “Stretch” stock pays an 11.25% variable dividend and aims for price stability.
  • The move targets investors seeking crypto exposure with lower risk.

Strategy is expanding its use of preferred stock as it looks for new ways to fund Bitcoin purchases while reducing pressure from market volatility. 

The move comes as the company’s share price continues to closely track swings in the cryptocurrency market.

Advertisement

A new approach to managing risk

In a Feb. 12 interview with Bloomberg, chief executive officer Phong Le said the company is offering more perpetual preferred shares to attract investors who want exposure to digital assets without extreme price changes. The product, known as “Stretch,” pays a variable dividend that is adjusted each month.

The current dividend rate stands at 11.25%. The structure is designed to keep the stock trading close to its $100 par value. This helps limit sharp price movements that are common in Strategy’s regular shares.

Preferred shares sit above common stock in the company’s capital structure but below debt. They usually offer a steady income and priority on dividends, while giving up voting rights. This makes them appealing to investors who value stability over rapid growth.

Advertisement

Funding Bitcoin while limiting volatility

Over the past three weeks, Strategy raised about $370 million through common stock sales and another $7 million through preferred shares. The funds were used to buy more Bitcoin (BTC), pushing the company’s total holdings above 714,000 BTC, worth roughly $48 billion.

For years, Strategy’s business model has been built around using capital markets to accumulate Bitcoin. As a result, its stock often behaves like a leveraged version of the cryptocurrency. When Bitcoin rises, the stock tends to surge. When prices fall, losses are often amplified.

Bitcoin has dropped around 50% from its recent peak, which has weighed heavily on Strategy’s shares. This slowdown has made it harder for the company to rely only on common stock sales for funding.

Preferred stock offers another option. The steady dividend and price controls are meant to attract institutions such as pension funds, insurers, and banks. These investors often prefer predictable returns rather than high-risk exposure.

Advertisement

Co-founder Michael Saylor has repeatedly said the company has no plans to sell its Bitcoin. Strategy intends to continue buying more each quarter, regardless of market conditions.

Analysts say preferred shares also strengthen the company’s balance sheet. Compared with convertible bonds, they reduce refinancing risk and limit sudden dilution for existing shareholders.

Strategy raised about $5.5 billion through several preferred stock offerings in 2025. The latest issuance continues that pattern, showing that the company sees long-term value in this funding model.

Advertisement

Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Crypto World

WTI Oil Price Climbs to a Monthly High

Published

on

WTI Oil Price Climbs to a Monthly High

As the XTI/USD chart shows, the price per barrel moved above the 4 February peak yesterday, marking its highest level since the start of the month. The bullish sentiment has been driven by geopolitical uncertainty. According to media reports:

→ The Trump–Netanyahu meeting in Washington on 10–11 February failed to ease tensions. Despite Omani mediation and statements suggesting a “near compromise”, no formal agreement has yet been reached.

→ Reports of a possible deployment of additional US carrier strike groups to the Middle East have added to market nerves. Any escalation could threaten supplies through the Strait of Hormuz, which accounts for around 20% of global oil consumption.

While the fundamental backdrop remains tense and continues to support higher oil prices, the chart simultaneously points to vulnerability to a pullback.

Advertisement

Technical Analysis of the XTI/USD Chart

When analysing the WTI oil chart on 5 February, we:

→ used recent price swings to construct a broad ascending channel (shown in purple), noting that its lower boundary was acting as support;

→ suggested that the $65 level would become a key obstacle for bulls attempting to maintain upward momentum.

Recent price action supports this view, as:

→ if yesterday’s move above the 4 February high is treated as a bullish breakout, it appears to have failed — a potential bull trap;

Advertisement

→ a bearish engulfing reversal pattern has formed on the chart (indicated by the arrow).

It is noteworthy that many investment bank analysts consider current WTI prices to be overstretched, forecasting a decline towards the $57–59 range due to oversupply. However, such a scenario would likely require a reduction in geopolitical risk.

In light of the above, it is reasonable to assume that the initiative may now be shifting to the bears, who could attempt to push prices towards the lower boundary of the channel. The $64.40 level — which acted as resistance last week — now appears to offer local support.

Start trading commodity CFDs with tight spreads (additional fees may apply). Open your trading account now or learn more about trading commodity CFDs with FXOpen.

Advertisement

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Source link

Advertisement
Continue Reading

Crypto World

Binance CEO Richard Teng breaks down the ‘10/10’ nightmare that rocked crypto

Published

on

Binance CEO Richard Teng breaks down the ‘10/10’ nightmare that rocked crypto

Binance did not cause the crypto market liquidation event on Oct. 10, but every exchange — centralized or decentralized — saw massive liquidations that day after China imposed rare earth metal controls and the U.S. announced fresh tariffs, said Binance Co-CEO Richard Teng.

About 75% of the liquidations took place around 9:00 p.m. ET, alongside two unrelated, isolated issues: a stablecoin depegging and “some slowness in terms of asset transfer,” Teng said Thursday at CoinDesk’s Consensus Hong Kong conference.

“The U.S. equity market plunged $1.5 trillion in value that day,” he said. “The U.S. equity market alone saw $150 billion of liquidation. The crypto market is much smaller. It was about $19 billion. And the liquidation on crypto happened across all the exchanges.”

Some users were affected by this, which Binance helped support, he said, an action other exchanges did not take.

Advertisement

Binance facilitated $34 trillion in trading volume last year, he said, with 300 million users. Trading data does not indicate any massive withdrawals from the platform.

“The data speaks for itself,” he said.

Speaking more broadly, Teng said the crypto market was tracking broader geopolitical tensions but that institutions are still pouring into the sector.

“At the macro level, I think people are still uncertain about interest rate movements going forward,” he said. “And there’s always the trend of geopolitics, tension, etc. Those weigh on these assets, such as crypto.”

Advertisement

However, pointing to how the sector has changed over the past four to six years, Teng said long-term industry participants will have noticed that crypto prices move cyclically.

“I think what we have to look at is the underlying development,” he said. “At this point in time, retail demand is somewhat more muted compared to the past year, but the institutional deployment, the corporate deployment is still strong.”

Institutions are still entering the sector, even despite the market, he said, “meaning the smart money is deploying.”

Read more: Crypto’s $19 billion ’10/10′ nightmare: Why everyone is blaming Binance for the bitcoin crash that won’t end

Advertisement

Source link

Continue Reading

Crypto World

Nikkei 225 Retreats From Record High

Published

on

Nikkei 225 Retreats From Record High

As the chart shows, the Nikkei 225 index (Japan 225 on FXOpen) reached a historic high near 58,500 points on Monday. Bullish sentiment was driven primarily by political developments.

According to media reports, the rally followed the decisive victory of the Liberal Democratic Party (LDP) under Sanae Takaichi, who has signalled aggressive fiscal stimulus measures (a package exceeding $135 bn), food tax cuts, and the continuation of an accommodative monetary policy stance.

However, today the Nikkei 225 is showing signs of a pullback. It is possible that major market participants have begun taking profits amid the wave of optimism, as Takaichi’s victory had already been largely priced in, and official confirmation of a parliamentary supermajority may have acted as a trigger to close long positions.

From a technical perspective, a retracement also appears justified.

Advertisement

Technical Analysis of the Nikkei 225 Chart

It is worth noting that:

→ after the RSI moved into extreme overbought territory, it formed a bearish divergence with price;
→ price action itself produced a bearish triple top pattern.

As the decline unfolds, a local trendline (shown in purple) has shifted from acting as support to functioning as resistance.

In light of the above, it is reasonable to assume that an extended pullback could drive the Nikkei 225 towards the median of the long-term ascending channel.

In the event of a deeper correction, the support zone below the 56,000 level may come into play, where a previous bullish imbalance formed characteristics of a Fair Value Gap pattern.

Advertisement

Trade global index CFDs with zero commission and tight spreads (additional fees may apply). Open your FXOpen account now or learn more about trading index CFDs with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Source link

Advertisement
Continue Reading

Crypto World

ARK Invest Snaps Up $33M in Robinhood Shares Amid Bitcoin Dip

Published

on

ARK Invest Snaps Up $33M in Robinhood Shares Amid Bitcoin Dip

ARK Invest, the investment firm led by Bitcoin bull Cathie Wood, snapped up a significant batch of crypto-linked stocks on Wednesday as BTC briefly dipped below $66,000.

ARK purchased 433,806 shares of Robinhood (HOOD) for approximately $33.8 million, according to a trade notification reviewed by Cointelegraph.

The asset manager also boosted its exposure to crypto exchange Bullish (BLSH) and USDC (USDC) issuer Circle (CRCL), acquiring 364,134 shares valued at $11.6 million and 75,559 shares worth $4.4 million, respectively.

The purchases came as all three stocks traded lower on the day, with Robinhood shares sliding nearly 9%, according to TradingView data.

Advertisement

ARK withheld from buying more Coinbase (COIN) shares after dumping $17 million of the stock last week.

Robinhood becomes top crypto holding in ARK’s flagship fund

ARK’s latest Robinhood acquisition coincided with the company’s official testnet launch of the Robinhood Chain, a permissionless layer 2 (L2) blockchain built for financial services and tokenized real-world assets (RWAs).

Earlier this week, Robinhood reported record net revenue of nearly $1.28 billion for the fourth quarter of 2025. While revenue surged 27% year over year, it fell short of Wall Street expectations of $1.34 billion, sending the stock down about 8%.

Source: Robinhood

As of Feb. 11, Robinhood stands as the largest crypto-linked position in ARK’s flagship ARK Innovation ETF (ARKK), accounting for roughly 4.1% of the portfolio, or about $248 million, according to the fund’s data.

Spot Bitcoin ETFs mirror BTC weakness as inflows stall

Broader market weakness has spilled over into US spot Bitcoin (BTC) exchange-traded funds (ETFs), which failed to sustain momentum after a three-day inflow streak.

Advertisement

According to SoSoValue data, Bitcoin ETFs recorded $276.3 million in net outflows on Wednesday, nearly wiping out weekly gains, which now stand at just $35.3 million. Total assets under management declined to $85.7 billion, the lowest level since early November 2024.

Daily flows in US spot Bitcoin ETFs. Source: SoSoValue

Ether (ETH) ETFs also posted losses, with daily outflows totaling $129.2 million. XRP (XRP) funds saw no inflows, while Solana (SOL) ETFs recorded modest inflows of roughly $0.5 million.

Related: Strategy CEO eyes more preferred stock to fund Bitcoin buys

At the time of publication, Bitcoin was trading at $67,227, up 0.4% over the past 24 hours, according to CoinGecko.

The latest pullback comes after analysts had pointed to a potential inflection point in crypto investment products following three consecutive weeks of outflows totaling more than $3 billion.

Advertisement

Magazine: Is China hoarding gold so yuan becomes global reserve instead of USD?