Strategy (MSTR), the largest corporate Bitcoin treasury holder, said in an Oct. 5 Form 8-K that it expects to recognize $20.91 billion in digital asset gains for the third quarter of 2026.
The company said the gain mainly reflected Bitcoin’s rebound during the quarter and was an unrealized mark-to-market gain, not profit generated by selling BTC. The filing also showed that Strategy slowed its Bitcoin buying activity last week and directed more capital to repurchasing its own STRC preferred shares.
Bitcoin holdings moved back above cost in the third quarter
According to the 8-K, the carrying value of Strategy’s Bitcoin holdings stood at $70.82 billion as of Sept. 30. The company also recorded $1.88 billion in related deferred income tax expense.
The filing pointed to a sharp change in the tax position tied to the cost basis of its Bitcoin. As of June 30, the market value of Strategy’s Bitcoin holdings was still below cost, leaving the company with a $4.12 billion deferred tax asset related to Bitcoin losses. By Sept. 30, market value had moved back above cost. That deferred tax asset was reversed, and the related valuation allowance was reversed as well, producing about $4.12 billion in income tax benefit.
Using the figures disclosed in the filing, Strategy held 847,666 BTC as of Sept. 30 with total cost of about $63.95 billion and an average cost of roughly $75,437 per coin. Against the $70.82 billion carrying value, that implied an unrealized gain of about $6.9 billion, or around 10.7%.
Only 334 BTC purchased last week
Strategy’s Bitcoin buying pace was far lighter than its late-September accumulation. The 8-K showed that the company made no Bitcoin purchases from Sept. 28 through Sept. 30. From Oct. 1 through Oct. 4, it bought 334 BTC for about $28.7 million, at an average price of about $85,839 per Bitcoin.
Those purchases were funded by $15.7 million raised through common stock issuance and $13 million from the company’s own cash.
During the same period, none of Strategy’s four preferred share classes — STRF, STRC, STRK and STRD — sold any shares through at-the-market offerings. The report noted that Strategy had bought 1,665 BTC at the end of September, lifting its holdings to 847,666 BTC, making last week’s purchase size noticeably smaller by comparison.
$176.3 million went to STRC repurchases
The company’s larger move last week was on the preferred share side. Strategy repurchased about 1.03 million STRC shares from Sept. 28 to Sept. 30 for $102.6 million, according to the filing. It then repurchased about 740,000 more STRC shares from Oct. 1 to Oct. 4 for $73.7 million.
In total, Strategy bought back about 1.77 million STRC shares for around $176.3 million. That works out to roughly $99.3 to $99.5 per share, slightly below the $100 par value. The filing said the October repurchases were paid for with the company’s own cash. Strategy still has about $547 million remaining under its preferred share repurchase program.
STRC is a floating-rate perpetual preferred stock issued by Strategy with a $100 par value. It has also been one of the company’s main tools for raising funds to buy Bitcoin.
This 8-K did not give an additional explanation for the repurchases. But Strategy had already outlined its policy in a July press release: if STRC trades below its $100 par value, the company intends to repurchase shares in a “regular and disciplined” manner; the deeper the discount, the more it plans to buy; as the price approaches par, the pace is expected to slow. Its longer-term goal is to keep STRC trading near $100.
Chief executive Phong Le said at the time that buying back shares below par effectively reduces future preferred dividend obligations at a discount and represents attractive capital allocation.
The report also said Strategy’s average STRC repurchase price was about $86.52 when the company started the program in July. Last week’s repurchase price had already risen above $99, indicating that STRC had returned close to par.
$5.7 billion in dollar assets as of Oct. 4
As of Oct. 4, Strategy held 848,000 BTC and about $5.7 billion in U.S. dollar assets.
Those dollar assets were split into two categories: $4.88 billion in “USD reserves,” earmarked for preferred dividends and debt interest payments, and about $830 million in “USD cash,” which may be used for Bitcoin purchases, reserve expansion or other capital uses.
Another Bitcoin treasury company, Strive, also filed an 8-K on Oct. 5 and said it bought 2,000 BTC, with an overall average cost of about $90,000, above the quarter-end Bitcoin price. Set side by side, Strategy’s earlier accumulation at lower cost left it back in profit after the price rebound, while its decision last week to slow Bitcoin buying and focus on preferred share repurchases stands out as a separate shift in capital deployment.