Strive Doubles Down on Bitcoin with $4.2B Offering as Strategy Sells – Who's Winning?

Strive received a nod of approval from Benchmark-StoneX analysts after the Bitcoin-buying asset manager padded cash reserves while growing its stockpile. The firm purchased 2,500 BTC last week, expanding its holdings to 19,000 BTC ($1.3 billion), and raised $44 million to ensure dividends on its preferred stock can be paid.

Strive has devised a variable-rate product dubbed SATA, offering a 13% annual dividend in daily payouts starting June 16—the first listed security in the U.S. to offer routine daily dividends. Analyst Mark Palmer described Strive and Strategy as friendly rivals, not competitors, as both are committed to furthering "digital credit." He said, "This is not a zero-sum game."

The investment bank initiated Strive coverage with a "Buy" rating and $32 price target. Despite shares falling 6.6% on market jitters from Strategy's first Bitcoin sale since 2022, Strive is doubling down: Chairman Matt Cole announced plans to increase an issuance program by $4.2 billion.

Strive's framework differentiates it from most other Bitcoin treasury companies, as it relies on debt-free preferred stock rather than convertible debt or margin financing. SATA's lack of refinancing and collateral risks mitigates forced deleveraging during Bitcoin price downturns.

Palmer described Strive as "nimble" for swiftly shifting SATA's dividend format, while Strategy has asked shareholders to vote on bi-monthly distributions. Strive has also shaken off its debt entirely, a process Strategy signaled could take 3-6 years.

Benchmark-StoneX reiterated a "Buy" rating and $570 price target for Strategy, arguing the market wrongly treated its 32 BTC sale as a betrayal. They expect Strategy to remain a significant net buyer of Bitcoin.