MicroStrategy (MSTR) investors flagged a curiously timed bitcoin (BTC) withdrawal right before the company’s founder, Michael Saylor, announced a $531.9 million purchase this morning.
They asked why the company seemingly created three brand new wallets and withdrew 7,382 BTC mere hours before announcing its acquisition of 4,980 BTC.
The timing and the amounts seemed “too weird.”
The data comes from Arkham, which compiles wallets and assets that might be under MicroStrategy’s control. However, none of the wallets or their movements are officially confirmed by any proof of reserves.
To be clear, MicroStrategy does not officially disclose its wallets.
Nevertheless, one observer speculated that the company’s dividend-yielding preferred stocks could provide a rational explanation for yesterday’s on-chain movements.
Indeed, the company has issued three series of preferred shares: Strike (STRK), Strife (STRF), and Stride (STRD). The former pays 8% and the latter two yield 10% annually.
Although the seniority, rights, and dividend mechanics are distinct within each series, the most relevant quality that they all share is the denomination of their payouts.
Somehow, the company must have possessed the USD this morning to make these payouts.
With negative operating income and earnings before interest, taxes, depreciation, and amortization over the trailing 12 months, as well as the first quarter of 2025, it’s difficult to service these dividend obligations from excess profits.
Still, the company reported $60 million in cash as of March 31, so it’s possible the company had enough cash for today’s payout.
Of course, a few investors were nonetheless concerned that the company might have had to sell BTC to raise the capital for these dividends. Selling even a small amount of BTC would have been disappointing to fans of Saylor, who believe he never intends to sell BTC.
However, given the company’s cash balance — not to mention Saylor’s considerable access to corporate debt markets — it’s unlikely that yesterday’s withdrawal of 7,382 BTC related to any sale.
Indeed, all three transactions involved in the 7,382 BTC withdrawals paid a small amount, near 0.000084 BTC, to Coinbase Prime addresses, likely as an on-chain fee payment.
Read more: We made a dictionary of MicroStrategy’s invented terminology
For example, Arkham’s label of a MicroStrategy-initiated 0.000084 BTC withdrawal to 3J7cUjBZxvGRCwFBz3q23zAsnhFfZrDSSU notes a Custody Gas Supplier.
Arkham categorizes a withdrawal of 0.000084 BTC to “Coinbase Prime Custody Gas Supplier.”
In other words, the most likely explanation for yesterday’s withdrawal of 7,382 BTC — even amid its 4,980 BTC purchase announcement this morning — is a simple transfer into Coinbase Prime custody.
