Buybacks edge out bitcoin buys at Strategy ahead of earnings

Strategy chairman Michael Saylor did not post his customary Sunday bitcoin chart this week as the company prepares to report earnings. Bitcoin watchers took that as a hint that Strategy (MSTR), the largest corporate holder of bitcoin, may have paused its buying. Saylor was still posting on X on Sunday, describing bitcoin as “the moat” in a reply to Jack Dorsey. Yet the chart that typically shows up just before a purchase announcement never came. An absent chart is a warning sign, not proof. Monday’s filing from the company will provide the answer, with third-quarter results scheduled for Thursday.

What exactly is the “orange dot chart”? Saylor has been posting a snapshot of Strategy’s bitcoin tracker on X just about every Sunday for more than a year. The snapshot maps how the value of the company’s holdings has evolved, with an orange dot for each purchase. This graphic has typically arrived ahead of a Monday 8-K filing that confirms Strategy bought bitcoin in the prior week. The wording attached to the chart changes weekly, but the meaning is usually identical: further coins are on their way. In the most recent two weeks, Saylor’s captions riffed on the theme of making room for more orange, and both instances were followed by purchase disclosures. None of this amounts to a fixed rule. In July, Saylor published the tracker with a noticeably vague caption after a sizable bitcoin sale, saying the orange dots captured only part of the story; the previous week’s post had come before the biggest sale in the company’s history. The absence of the chart implies a halt in buying, yet it falls short of proof.

The buying has already slowed; what matters more is how small the recent purchases have become. For the week through October 18, Strategy acquired 267 BTC for around $22.1 million, or an average of $82,900 per coin. A 250 BTC buy for approximately $21.5 million had come the previous week. At some points earlier in the year, weekly purchases by themselves exceeded 20,000 BTC. The latest transaction was financed almost wholly by the sale of 140,872 MSTR shares under Strategy’s at-the-market program. In the same week, a considerably larger sum went toward the company’s own securities. It devoted $193.1 million to repurchasing 1.94 million shares of STRC preferred stock, and the board increased the digital credit securities repurchase program from $2 billion to $3 billion. STRC is a preferred share carrying a regular dividend. Repurchases at a price below the $100 face value cut future dividend expenses.

Strategy has been a seller of bitcoin this year as well. The company said it sold 32 BTC in early June, the first disposal it had reported since a tax-loss trade in 2022. A sale of 3,588 BTC followed, bringing in about $216 million to cover preferred stock distributions and strengthen its US dollar reserve. Between July 27 and August 2, another 1,638 BTC was sold at an average of $63,957, and the proceeds went partly to preferred dividends and partly to STRC buybacks. After all that, Strategy still owns 848,517 BTC, purchased for roughly $64 billion at an average of $75,446 per coin — more than 4% of bitcoin’s total supply.

What could alter that reading? A pause is not without precedent. Saylor’s chart made a comeback in September following a two-week stretch without purchases, and buying picked up again. Strategy also has the cash to keep buying. As of October 4, the USD Reserve was $4.88 billion and USD Cash came to $833.4 million. A substantial purchase revealed in Monday’s filing would weaken the narrative that buying has slowed. Another subdued week for bitcoin purchases, together with more buybacks, would strengthen that narrative.

What bears watching now: the first hurdle is Monday’s 8-K, which will disclose whether Strategy bought, sold or held bitcoin last week and how much went to buybacks. Third-quarter numbers follow. The earnings release is scheduled for after the US market close on Thursday, October 29, along with a live webinar at 5:00 p.m. Eastern Time. The top-line profit figure should come as no great surprise, because the fair value of Strategy’s bitcoin already exceeded its cost basis on September 30. Likely to matter more are management’s comments on funding, dividends and how it balances buybacks with new bitcoin purchases. For bitcoin traders, the practical takeaway is that Strategy has been a consistent buyer across much of this cycle. Should weekly purchases remain modest, the market loses a dependable source of demand. Pay attention to the scale of purchases, not simply whether they occur.