Bitcoin’s Folly: A $12.4B Loss and a Digital Fortress of Dreams

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Ah, Strategy Inc., that paragon of financial panache, has graced us with a quarterly net loss of $12.4 billion, a sum so grand it could fund a small nation’s extravagance. Yet, in the same breath, they flaunt their 713,502 bitcoins, valued at $59.75 billion, as if to say, “Behold, our digital hoard!” Their Digital Credit platform, STRC, has swelled to $3.4 billion, a mere trifle in their grand scheme of fiscal theatrics.

The world, ever so predictable in its astonishment, gasped as Strategy Inc. unveiled a $12.4 billion net loss for Q4 2025. The Bitcoin Treasury Company, undeterred by such trivialities, continues to amass bitcoins, now totaling 713,502, a hoard that would make even the most avaricious dragon blush.

According to Strategy’s official press release, the company acquired 41,002 bitcoins in January 2026 alone. President and CEO Phong Le, with a flourish worthy of a Victorian dandy, announced that the firm raised $25.3 billion in capital throughout 2025, making Strategy the largest US equity issuer for two consecutive years. Truly, a feat as impressive as it is bewildering.

Bitcoin Holdings Surge Amid Accounting Prestidigitation

Strategy’s bitcoin cache, a treasure trove of 713,502 coins, cost a mere $54.26 billion, averaging $76,052 per bitcoin. Its current market value, a fleeting $59.75 billion as of February 1, 2026, is but a number in their grand ledger of ambition. The company boasts a 22.8% BTC Yield in fiscal year 2025, falling neatly within their target range of 22% to 26%. Executive Chairman Michael Saylor, ever the poet of finance, dubbed their holdings a “digital fortress,” a bulwark against the whims of the market.

CFO Andrew Kang, with a wave of his accounting wand, revealed a major shift: Strategy now employs fair value accounting for Bitcoin. The Q4 operating loss of $17.4 billion, a figure so grand it borders on the absurd, includes unrealized losses on digital assets. In contrast, the previous cost-less-impairment accounting method showed a mere $1.0 billion in losses for Q4 2024. Ah, the magic of numbers!

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Digital Credit Platform: A Rising Star in the Firmament of Finance

STRC Stock, that darling of the markets, has scaled to $3.4 billion in aggregate stated amount. Its variable dividend rate, a modest 11.25%, has yielded $413 million in cumulative distributions, with a 9.6% blended annual dividend rate. The company, ever prudent, established a $2.25 billion USD Reserve, providing 2.5 years of dividend and interest coverage. Kang assures us this strengthens their credit profile significantly, though one wonders if it strengthens their sense of humor as well.

Strategy raised $5.6 billion in Q4 2025 through various stock programs, with an additional $3.9 billion flowing in between January 1 and February 1, 2026. The Common Stock ATM Program alone generated $4.4 billion in Q4, a sum that could fund a small army of aesthetes.

Tax Benefits: The Sweet Siren Song of Return of Capital

All 2025 distributions on preferred equity instruments qualified as nontaxable return of capital, a boon for US federal income tax purposes. Strategy expects these ROC distributions to continue for ten years or more, a promise as grand as their losses. The company, with a straight face, asserts it has no accumulated earnings and profits for tax purposes and does not expect to generate current E&P in the foreseeable future. How delightful!

Strategy’s STRC dividend framework, a mechanism of such complexity it could only be devised by the most ingenious of minds, uses the volume-weighted average price monthly. Prices below $95 trigger 50 basis point increases, while prices above $101 prompt 25 basis point decreases, ensuring STRC trades near its $100 stated amount. A masterpiece of financial engineering, if ever there was one.

Software revenues reached $123 million in Q4 2025, a 1.9% year-over-year increase. Subscription services revenues jumped 62.1% to $51.8 million, while product support revenues declined 16.9% to $48.5 million. A tale of rises and falls, much like the company itself.

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2026-02-06 15:28