Strive CIO Says Bitcoin Treasury Firms Should Balance Three Funding Tools

Strive Chief Investment Officer Ben Werkman said Nov. 10 that Bitcoin (BTC) treasury companies can support long-term shareholder value by combining stock sales, credit products and buybacks.

The tools serve different financing needs, Werkman said. A company can issue common shares when its equity trades at a premium to the value of its Bitcoin reserves, then use the proceeds to buy more Bitcoin.

Preferred shares or bonds offer another way to finance purchases while limiting dilution for common shareholders, though they add leverage. Buybacks can increase value per share when a company’s stock is undervalued or it has excess cash, Werkman said.

Strive’s SATS preferred stock ranks ahead of its common shares but behind SATA preferred stock and future indebtedness. Holders of SATS preferred stock have no direct claim on Bitcoin.