Strategy launches the "Digital Credit Capital Framework", setting up a BTC monetization plan and two $1 billion repurchase plans.

According to Strategy’s 8-K filing with the U.S. Securities and Exchange Commission (SEC), the company announced the launch of its "Digital Credit Capital Framework", which includes five core components: a U.S. dollar reserve policy, an adjusted STRC dividend policy, a preferred stock repurchase plan, a common stock repurchase plan, and a BTC monetization plan. Under the U.S. dollar reserve policy, the reserve may only be used to pay preferred stock dividends and debt interest, and management must maintain a reserve level sufficient to cover at least 12 months of expected future dividend and interest payments. As of June 28, the U.S. dollar reserve balance stood at $2.55 billion. Regarding STRC dividends, the company will dynamically assess the dividend rate monthly by considering factors such as trading price, market yields, credit spreads, and Bitcoin price volatility, and will not raise the dividend solely because STRC’s trading price is below par value. The company also announced it will raise STRC’s annualized dividend rate from its previous level to 12.00%, effective July 1. For the repurchase plans, the company established two $10 billion repurchase authorizations: one for repurchasing preferred stocks including STRC, STRF, STRD, STRK, and the other for Class A common stock, with STRC being the primary target of the preferred stock repurchase plan. Neither repurchase plan will use U.S. dollar reserve funds. Additionally, the company’s board of directors authorized the BTC monetization plan, allowing the company to raise up to $1.25 billion by selling Bitcoin, to supplement the U.S. dollar reserve, pay preferred stock dividends and interest expenses, or fund the aforementioned repurchase plans.