<\/p>\n
Strategy plans to reduce the debt on its balance sheet by converting its $6 billion in convertible bonds into equity over the coming years, according to founder Michael Saylor.<\/p>\n
In a Sunday X post<\/a>, Saylor confirmed the plan in response to a statement<\/a> from the company\u2019s account, reiterating that the firm can \u201cwithstand a drawdown in BTC price to $8,000\u201d before facing any shortfall in covering its debt.<\/p>\n What this essentially means is the world\u2019s largest corporate Bitcoin holder plans to systematically turn the company\u2019s lenders into shareholders by converting outstanding convertible bonds into common equity. This is expected to transpire over the next \u201c3-6 years,\u201d Saylor said.<\/p>\n Currently, the company has a convertible debt load of roughly $6 billion and Bitcoin holdings that amount to approximately $49 billion based on current prices, with more than 714,000 BTC on its balance sheet.<\/p>\n <\/p>\n Although the move may be able to shield its aggressive Bitcoin accumulation strategy from refinancing pressure, the conversion could also dilute existing shareholders once the debt is exchanged for newly issued stock.<\/p>\n On Feb. 12, Strategy CEO Phong Le said the company will increasingly rely on perpetual preferred shares such as Stretch (STRC) to fund future Bitcoin purchases while reducing reliance on common stock sales.<\/p>\n Strategy shares have struggled over the past few months due to Bitcoin\u2019s latest downturn, but rallied over 8% to close at $133.88 on Friday, rallying another 0.24% in after-hours trading, as Bitcoin briefly reclaimed the $70k mark.\u00a0<\/p>\n The rally was short-lived, and Bitcoin has receded back towards $68,700 at press time, down roughly 2% in the past 24 hours.<\/p>\nStrategy under stress amid Bitcoin volatility<\/h1>\n