MicroStrategy pauses buys, says MSTR shareholders don’t own its bitcoin

In two legal filings, MicroStrategy (now doing business as Strategy) has revealed that the company paused bitcoin (BTC) purchases last week. Moreover, it reminded common MSTR shareholders that they don’t have an ownership interest in any BTC the company holds.

The Michael Saylor-founded company owned 528,185 BTC, acquired for an average price of $67,458, as of March 30. It still owned that exact amount yesterday.

Strategy’s latest regulatory filing indicates that its so-called At The Market or “ATM” program paused entirely last week. The company sold zero shares of Class A common stock or Series A Perpetual Strike Preferred Stock last week.

MicroStrategy bought 2.6% of circulating bitcoin at $67,458 apiece

Read more: MicroStrategy invents a new way to dilute shareholders with STRK

Further, multiple announcements by the company, which mirror disclaimers by other companies like Riot, disclaim that MSTR stock doesn’t confer any “ownership interest in the BTC the company holds.”

To be fair, this wouldn’t be the first time Strategy has paused its BTC acquisitions. Indeed, it made no BTC purchases between September 20 and November 11. 

It has also disclaimed ownership of BTC from MSTR shareholders for many months. Legal technicalities prohibit the company from admitting that Strategy’s BTC, which a custodian holds on behalf of the company and to which multiple series of creditors have claims and encumbrances, is directly owned by MSTR shareholders.

Bitcoin influencer uses wordplay on Michael Saylor tweet.

Moreover, MSTR isn’t an exchange-traded fund and doesn’t provide redemption rights for assets of the company. Instead, MSTR represents an ownership stake in Strategy’s equity. Strategy, in turn, owns encumbered BTC as well as its associated debts plus a variety of other business assets.

Over the last year, Strategy has purchased significant quantities of BTC and has acquired it as often as once a week. It acquired a sizeable amount — 22,048 BTC — in its latest acquisition announced on March 31.

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