Strive CEO Says Company Can Survive Even if Bitcoin Falls to 1 Cent
Summary
- Cole said Strive can survive even if Bitcoin falls to 1 cent.
- Strive said it is funded through preferred stock issuance without debt and holds 85% to 90% of its assets in Bitcoin and 10% to 15% in cash.
- Strive said it is carrying the burden of preferred shares paying 13% and 15% annual dividends, and that it has bought 43,153 Bitcoin at an average price of $87,821 and is now sitting on an unrealized loss of about 24%.
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Matt Cole, chief executive officer of Bitcoin treasury company Strive, said the firm could survive even if Bitcoin plunged to an extreme low.
Stocktwits reported on November 14 that Cole, speaking on a recent episode of Anthony Pompliano’s podcast, said the company could survive even if Bitcoin fell to 1 cent.
Strive is raising capital through preferred stock issuance without taking on debt. As a result, there is no Bitcoin price level that would trigger forced liquidation, Cole said.
He added that the company is prepared for a scenario in which Bitcoin falls as much as 80%. About 85% to 90% of its assets are held in Bitcoin, with the remaining 10% to 15% in cash, a structure designed to help it withstand a downturn without selling Bitcoin.
Strive still faces the burden of paying high dividends to preferred shareholders. The company’s SATA and SATS preferred shares currently carry annual dividend rates of 13% and 15%, respectively.
Strive currently holds 43,153 Bitcoin purchased at an average price of $87,821. With Bitcoin falling to about $67,000, the company is sitting on an unrealized loss of about 24% relative to its average purchase price.
Uk Jin
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