ASST Stock Slips Overnight: Strive Upsizes SATS Preferred Offering At 10% Discount; CEO Calls 5-Year Chart ‘Meaningless’

• Proceeds could fund bitcoin purchases, investments, acquisitions and ASST or SATA share repurchases.
• CEO Matt Cole called criticism of ASST’s five-year performance “meaningless,” saying Strive had outperformed bitcoin since its reverse merger.
• SATS carries a $15 annual dividend per share, offering a 16.67% yield at the offer price if paid fully.

Shares of Strive, Inc. (ASST) edged 0.4% lower overnight heading into Friday after the bitcoin treasury company priced a larger SATS preferred-stock offering at a discount, while CEO Matt Cole dismissed criticism of its five-year share-price history as “meaningless.”

ASST stock ended Thursday’s regular trading session at $25.65, up nearly 4%.

Strive Expands SATS Offering To $630M

Strive priced 7 million SATS preferred shares at $90 each late Thursday, expanding the offering by 40% from the 5 million shares proposed on Tuesday. The offer price is 10% below the shares’ $100 face value. 

The offering therefore carries $700 million in total value and is expected to generate $630 million in gross proceeds before underwriting discounts, commissions and expenses. Settlement is scheduled for Oct.20. Cole said on X that he would discuss the details on The Hurdle Rate Podcast when the offering settles.

Strive plans to use the proceeds for purposes including bitcoin purchases, income-generating investments, working capital, capital spending, complementary acquisitions and repurchases of ASST common stock or SATA preferred shares. 

CEO Says Strive Has Outperformed Bitcoin

Meanwhile, Cole pushed back against Fred Krueger, founder and investor at 2718.fund, who shared an image showing ASST down 92.9% over five years. Krueger’s fund borrows against bitcoin holdings to make monthly distributions to investors.

“This five-year chart is meaningless,” Cole said. He pointed to Strive’s takeover of Asset Entities, which he called a failing company, and said: “Since then, Strive has outperformed Bitcoin.”

The reverse merger, completed last year, combined Strive with Asset Entities, previously a digital marketing and content delivery company, to create a publicly traded bitcoin treasury business. Bitcoin was trading around $82,000 early Friday after recovering from a brief drop below $80,000 on Thursday.

Bitcoin Stress Test Puts Shareholder Cushion In Focus

Earlier this week, Krueger warned that financing bitcoin purchases with preferred stock paying 13%-15% annual dividends could erode shareholders’ protection. Assuming bitcoin fell 33% over three years, his model deducted $891 million in bitcoin losses and $772 million in dividends from $3.56 billion in treasury assets. The remaining $1.90 billion matched preferred shareholders’ claims.

“The entire common equity cushion is gone,” he said, leaving preferred holders with “essentially zero margin of safety.” The model assumed no new capital, operating income or other treasury changes and used the original $500 million offering, before its expansion to $700 million in face value.

Cole dismissed the warning by pointing to Krueger’s support for BIP-110, a proposal to temporarily restrict non-payment data, such as images and text, in Bitcoin transactions. Cole suggested that the change could have triggered the downturn Krueger modeled. “Thankfully you were ignored then, and will be ignored now,” he said. 

SATS Promises Big Dividends As Bitcoin Holdings Grow

SATS carries a $15 annual dividend per share, offering a 16.67% yield at the $90 offer price if paid in full. Payments are scheduled starting Nov.9, subject to board approval and available funds. 

Strive plans to reserve $157.5 million in existing cash and securities for the first 18 months of dividends. SATS holders rank behind SATA holders but ahead of common shareholders. Defending the company’s incentives, Cole said most rewards depend on “outperforming Bitcoin over a multi-year time period.” He cited a 64% increase in bitcoin per share this year.

Separately, Strive disclosed buying 2,822 bitcoin for about $235 million during Oct. 12-Oct.13, bringing holdings to 35,595 bitcoin, according to Cole. Investors also exercised warrants covering 13.7 million common shares, generating expected gross proceeds of $369.2 million.

How Do Retail Traders Feel About ASST?

On Stocktwits, retail sentiment for ASST has been ‘bearish’ over the past three months amid ‘normal’ message volume.

One user said, “$MSTR well I trimmed tonight and moved to $ASST  maybe an over reaction in my part but I’ve had a brutal couple weeks.”

Another user said, “$ASST Will never see my average again. No shaking me out.”

ASST stock has risen 74% year-to-date. 

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read Next: Did ASTS Miss Its Rocket Lab Moment? Analyst Warns Deal Window May Be Closing, Floats Firefly As A Target