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MicroStrategy, the largest public corporate holder of Bitcoin, has doubled down on its commitment to the leading cryptocurrency with a series of bold moves. The company recently announced its largest-ever Bitcoin purchase, acquiring 51,780 BTC for $4.6 billion, while simultaneously raising $1.75 billion through 0% senior convertible notes to fund additional acquisitions.
MicroStrategy’s Bold Bitcoin Bet: $1.75 Billion Raised Through 0% Convertible Notes
MicroStrategy, the world's largest corporate holder of Bitcoin, has announced plans to raise $1.75 billion to expand its Bitcoin holdings further. This audacious move comes through the issuance of 0% senior convertible notes, maturing in 2029. The announcement, made on Nov. 18, marks another aggressive step in the company’s strategy to position Bitcoin as a cornerstone of its financial framework.
In its official statement, MicroStrategy revealed that the funds raised would primarily be used to acquire additional Bitcoin and support general corporate purposes. The zero-percent interest rate on the convertible notes is a standout feature of this offering, as it alleviates regular interest payment obligations for the firm. Instead, these notes are issued at a discount and will mature at face value if not converted prior to the 2029 deadline.
Convertible notes offer investors an opportunity to exchange their holdings for equity in the future, typically at a premium. MicroStrategy’s latest notes are “senior” to its common stock, granting their holders preferential claims in the event of bankruptcy or liquidation. This arrangement provides a layer of security for investors, making the offering attractive despite the absence of regular interest payments.
If MicroStrategy allocates the entire $1.75 billion raised to Bitcoin purchases, it could add approximately 19,065 BTC to its treasury at current market prices. This would further solidify its status as the largest corporate Bitcoin holder.
Michael Saylor, MicroStrategy’s executive chairman and Bitcoin evangelist, has often emphasized the transformative potential of Bitcoin. The company’s long-term strategy has proven fruitful, with its Bitcoin holdings now up 133% from its average acquisition price of $39,292 per Bitcoin.
MicroStrategy’s stock (MSTR) surged nearly 13% on Nov. 18 as well, closing at $374.8 — a new all-time high. However, it saw a slight 0.7% dip in after-hours trading, according to Google Finance data.
The broader cryptocurrency market has also been riding high. Bitcoin is currently trading at $91,653, just 2% shy of its all-time high of $93,477 reached on Nov. 13, per CoinMarketCap data. MicroStrategy’s aggressive accumulation is likely contributing to market sentiment, positioning Bitcoin as an increasingly critical asset in corporate treasuries.
MicroStrategy’s Ambitious “21/21” Plan
Last month, MicroStrategy unveiled its ambitious "21/21" plan, aiming to raise $42 billion over three years. The plan involves a balanced strategy of issuing $21 billion in equity and $21 billion in fixed-income securities. The funds will be used to bolster its Bitcoin reserves further, aligning with Michael Saylor’s vision of making Bitcoin the ultimate store of value.
MicroStrategy’s relentless Bitcoin accumulation continues to set a precedent for other corporations. By leveraging innovative financing mechanisms like 0% convertible notes, the company has demonstrated how traditional financial instruments can be adapted to support unconventional strategies.
As Bitcoin approaches new all-time highs, the firm’s success story might inspire more corporations to follow suit. However, critics argue that such an aggressive approach exposes companies to significant risks, given Bitcoin's notorious volatility.
MicroStrategy Continues Aggressive Bitcoin Accumulation as BTC Hits Record Highs
MicroStrategy's plan to raise additional capital comes after the software firm made another substantial investment in the leading cryptocurrency, further solidifying its position as a dominant institutional player in the digital asset market. On Nov. 18, the company announced the purchase of 51,780 Bitcoin, acquired at an average price of $88,627 per Bitcoin, totaling $4.6 billion.
This latest acquisition is not only the company’s largest single Bitcoin purchase to date but also a strong indication of its unwavering belief in the cryptocurrency’s potential as a store of value.
With this purchase, MicroStrategy’s total Bitcoin holdings have grown to an impressive 331,200 BTC, acquired at an aggregate cost of $16.5 billion.
The 51,780 BTC purchase accounts for over 16% of MicroStrategy’s total Bitcoin treasury, marking a significant milestone in its ongoing accumulation strategy. According to data from CryptoQuant, this purchase is the largest Bitcoin buy on record for the company, further establishing its dominance in the institutional Bitcoin landscape.
MicroStrategy financed this massive acquisition using proceeds from a share sale under an agreement with leading financial firms, including TD Securities, Barclays Capital, and Canaccord Genuity, among others. Between Nov. 11 and 13, the company issued and sold 13.6 million shares, raising $4.6 billion to fund the Bitcoin purchase.
As of Nov. 17, MicroStrategy reported approximately $15.3 billion in shares still available for sale under this agreement, according to a filing with the United States Securities and Exchange Commission (SEC). This positions the company well for further Bitcoin acquisitions in the future.
MicroStrategy’s latest purchase comes at a time when Bitcoin has been setting new all-time highs. On Nov. 12, Bitcoin surpassed the $90,000 mark for the first time, reaching a new peak above $92,400 the following day.
The company’s founder and executive chairman, Michael Saylor, has remained a vocal advocate for Bitcoin, often citing its potential to outperform traditional assets as a hedge against inflation. In a recent interview with CNBC, Saylor dismissed the likelihood of Bitcoin retracing to $60,000 or lower, expressing confidence in its continued upward trajectory.
Since its first Bitcoin purchase of $250 million in August 2020, MicroStrategy has consistently added to its holdings, making Bitcoin its “primary reserve currency.” The company’s investments have already yielded significant returns, with its Bitcoin holdings now valued at over $30 billion at current prices.
Institutional Leadership in Bitcoin
MicroStrategy’s bold strategy has positioned it as a pioneer among institutional Bitcoin holders. Data from BitcoinTreasuries shows that the company is the largest identified institutional Bitcoin holder globally, far surpassing other corporations in its commitment to the cryptocurrency.
MicroStrategy’s moves have also inspired other institutions to explore Bitcoin as a strategic asset. The company’s success story serves as a case study for how corporations can integrate cryptocurrency into their financial strategies, despite market volatility.
Michael Saylor, who stepped down as CEO in 2022 to focus on Bitcoin initiatives, remains a steadfast advocate for the cryptocurrency. Under his leadership, MicroStrategy has not only transformed its balance sheet but also redefined corporate treasury management.
Saylor’s recent statements are a telling sign of his confidence in Bitcoin’s future. “I don’t think it is going to $60,000, it is not going to $30,000, I think it is going to go up from here,” he remarked, emphasizing his belief in Bitcoin’s potential to reach new heights.
Meanwhile, MicroStrategy’s relentless Bitcoin accumulation is indicative of its commitment to the cryptocurrency as a cornerstone of its financial strategy. With Bitcoin prices at historic highs and institutional adoption continuing to grow, the company’s bold moves could set the stage for even greater influence in the crypto market.
As MicroStrategy continues to raise capital and expand its Bitcoin treasury, its actions are likely to further legitimize Bitcoin as a key asset for institutional investors, while pushing the boundaries of corporate cryptocurrency adoption.