Phong Le, CEO of treasury company Bitcoin Strategy, described in an interview Friday the terms under which the company would sell some of its Bitcoin holdings.
The company will sell Bitcoin to pay the dividend on its Series A Expandable Perpetual Preferred Stock (STRC), a corporate credit instrument that pays a dividend of 11.5% to holders, and to defer or offset taxes, The said CNBC. He added:
“I believe in math over ideology, and at the point where selling Bitcoin rather than selling stock to pay a dividend is better for our Bitcoin per share and for our common shareholders, we will do it.”
Le added that the company would only sell BTC to pay the return owed to holders of its credit instruments if the sales were “accretive” to Strategy shareholders, meaning the company increases BTC per share.
Source: Phong Le
The comments came after Strategy co-founder Michael Saylor said the company could periodically sell part of your BTCstoking BTC investors’ fears about the potential impacts of Strategy’s sales on the Bitcoin market price.
Related: Samson Mow defends its strategy by selling part of its Bitcoin treasury
Saylor says Strategy could sell BTC, but Le says it won’t have significant impact on asset prices
“We will probably sell Bitcoin to fund a dividend, just to inoculate the market, just to send the message that we did it,” Saylor said during an earnings call Tuesday.
Saylor added that if BTC appreciates more than 2.3% per year, Strategy could fund its dividend payments “forever” without selling Strategy shares and diluting shareholders.
Strategy’s annual BTC cash yield. Source: Strategy
“We could stop selling MSTR common stock right now,” Saylor said, adding, “We can fund dividends with Bitcoin sales.”
The company holds 818,334 BTC, valued at over $66 billion at the time of this writing, making it the largest publicly traded BTC treasury company, according to data from BitcoinTreasurers.
Treasury companies offloading their BTC may create selling pressure that will negatively impact the price of Bitcoin; However, Le said BTC’s daily trading volume of around $60 billion is enough to absorb the more than $1 billion in annual dividends Strategy owes.
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