Strategy: By 2025, raise a total of $7.4 billion through digital credit, with $413 million already paid out in distributions.

ChainCatcher Message, according to an official announcement, Strategy today announced that for U.S. federal income tax purposes, 100% of the distributions paid by the company within the 2025 fiscal year to its preferred equity instruments are recognized as tax-free return of capital, provided they do not exceed the tax basis of the preferred equity instruments held by shareholders.

In 2025, Strategy completed five initial public offerings (IPOs) of perpetual preferred stock securities (“Digital Credit”), raising a total of $5.5 billion. Subsequently, the company also raised an additional $1.9 billion through an ATM (at-the-market) program for the Digital Credit instruments. To date, Strategy has paid a total of $413 million in distributions on these instruments, with an associated weighted annualized dividend rate of approximately 9.6%.

Strategy states that, for U.S. federal income tax purposes, the company currently has no accumulated retained earnings and does not expect to generate current E&P in the current year or foreseeable future. Based on this assessment, Strategy anticipates that the distributions on its preferred equity instruments will continue to be treated as a return of capital in the foreseeable future (i.e., 10 years or longer).