Despite South Dakota’s hesitance, Strategy continued its aggressive Bitcoin accumulation by purchasing an additional 20,356 BTC for $2 billion. This latest purchase brought its total holdings to almost 500,000 BTC. Despite this, Bitcoin is on track for its first negative February since 2020, with its price struggling to maintain support above $95,000. Market sentiment also still seems weak as spot Bitcoin ETF outflows continue.
South Dakota Kills Bitcoin Bill
South Dakota lawmakers have effectively killed a bill that could have allowed the state to invest in Bitcoin after deferring the vote beyond the legislative session’s 40-day limit. The proposed legislation, HB 1202, sought to amend the classification of state public funds to permit up to 10% investment in Bitcoin. During a meeting of the House Commerce and Energy Committee on Feb. 24, the majority of lawmakers voted to push the bill to the 41st day, which is a move that prevents it from moving forward this session.
The bill’s sponsor, State Representative Logan Manhart, introduced the legislation on Jan. 30 with the intent to integrate Bitcoin into South Dakota’s investment strategy. After the setback, Manhart announced his plans to reintroduce the bill in 2026, hoping for a different outcome in future legislative sessions.
Similar attempts to establish Bitcoin reserves have failed in other states, including North Dakota, Montana, and Wyoming. However, lawmakers in several states, including Florida, Arizona, Utah, Ohio, Missouri, and Kentucky, have introduced similar legislation that is still under consideration.
The push for Bitcoin investment at the state level is part of a broader shift in policy after the inauguration of US President Donald Trump. During his campaign, Trump promoted the idea of creating a “strategic national Bitcoin stockpile,” which he formalized in a Jan. 23 executive order establishing a working group to study the feasibility of such a reserve. However, many of Trump’s executive actions have faced legal challenges as critics question their constitutionality.
Since taking office on Jan. 20, Trump’s administration departed from the regulatory stance of his predecessor, Joe Biden. The US Securities and Exchange Commission (SEC) took a hardline approach to crypto regulation under Biden, but now has already dropped several investigations into crypto firms.The SEC has even closed its case against Coinbase, a major crypto exchange that was under scrutiny since 2023.
Strategy Nears 500,000 BTC Holdings
Despite the fact that some US states are stepping back from Bitcoin, Strategy recently expanded its Bitcoin holdings with an additional $2 billion purchase. This yet again solidifies its position as the largest corporate holder of the cryptocurrency. The firm bought 20,356 Bitcoin at an average price of $97,514 per token, bringing its total Bitcoin reserves to 499,096 BTC. These holdings were acquired for approximately $33.1 billion at an average price of $66,357 per BTC. The announcement was made by Executive Chairman Michael Saylor in a post on X.
The acquisition took place after the firm’s successful senior convertible note offering, which raised $2 billion. The notes carry a 0% coupon and mature in 2030, with each $1,000 block convertible to 2.3072 shares of Strategy’s Class A common stock at a 35% premium over the current market price. After deducting fees and estimated expenses, Strategy secured approximately $1.99 billion in net proceeds, which it plans to use for general corporate purposes, including more Bitcoin acquisitions.
The move is part of Strategy’s ambitious “21/21 Plan,” which aims to raise $42 billion over three years through a combination of equity and fixed-income securities to fund additional Bitcoin purchases. The firm has already secured $20 billion under this plan, relying heavily on senior convertible notes and debt to fuel its Bitcoin accumulation.
Despite reporting a net loss of $670 million in the fourth quarter of 2024, Strategy is still very much committed to its aggressive Bitcoin strategy. Now that its holdings approach the 500,000 BTC milestone, the firm’s unrealized profit on its Bitcoin position surged to more than $12.8 billion, according to data from Saylortracker.
Strategy Bitcoin holdings (Source: Saylortracker)
Institutional interest in Strategy has also grown a lot recently, with pension funds and treasuries across twelve North American states reportedly holding a combined $330 million worth of the firm’s stock by the end of 2024. Additionally, BlackRock, the world’s largest asset manager, recently increased its stake in Strategy to 5% after the company’s rebranding on Feb. 5.
Bitcoin Faces First Negative February Since 2020
Bitcoin is on track to register its first negative monthly return since February 2020 as it is currently down over 10% for the month. With less than a week left, the leading cryptocurrency’s lack of bullish momentum suggests that a new all-time high is unlikely in the short term. Historically, February has seen an average return of around 14%, but current market sentiment is still very subdued.
Bitcoin monthly returns (Source: Coinglass)
Since surpassing the $92,000 mark on Nov. 19 of 2024, Bitcoin has spent 65 out of 97 days trading between $92,000 and $100,000. Despite reaching new highs above its previous record of $74,000, Bitcoin’s price action in 2025 has been largely stagnant, with only a 1.97% increase since the beginning of the year.
However, some analysts see this consolidation as a sign of progress. Bitcoin’s realized cap, which measures the value investors actually paid for their coins rather than their current market price, increased by $160 billion in the past three months. Sina G, co-founder of 21st Capital, described this as an influx of new net capital that indicates market growth despite price stagnation.
The lack of price movement also contributed to lower network activity. Bitcoin researcher Axel Adler Jr. noticed that daily transfer volume dropped by 76%, while active wallet addresses declined by 74% over the past week. However, long-term holders are still quite resilient, with the coin days destroyed metric hitting a multi-year low. This suggests that investors are refraining from panic selling.
For now, Bitcoin’s ability to stay above $95,000 is under increasing pressure. The asset experienced a sharp decline of 11.30% from $102,000 to $91,100 at the start of February, but has so far managed to close daily candles above $95,000 throughout the month. However, this support level has been tested about three times in the past week and is weakening, increasing the likelihood of Bitcoin dropping below $91,000 and potentially revisiting sub-$90,000 levels.
Bitcoin’s price action over the past month (Source: CoinMarketCap)
Despite the announcement of Strategy’s recent acquisition of 20,356 BTC, Bitcoin still failed to see any meaningful recovery. Overall, market conditions are very fragile, with even spot Bitcoin exchange-traded fund inflows drying up significantly. On Feb. 20, outflows from spot Bitcoin ETFs reached $364 million, which also contributed to the lack of short-term buying pressure.
