thenewscrypto.com
Microstrategy the company ran by CEO Michael Saylor just raised 1.6 billion dollars through a junk bond offering, the company had set out to raise $400 million but raised 4 times the amount. The company aims to buy bitcoin through the money raised.
Microstrategy and its CEO Michael Saylor were one of the first proponents of bitcoin that led to the bull market of 2020-21.
One of the first organizations to buy and hold bitcoin on their balance sheet, Microstrategy has the biggest bitcoin holdings on their balance sheet.
The company holds around $3.2 billion worth of bitcoin on its balance sheet. The company saw tremendous growth in not just its holdings, but also its stock price during the price surge earlier this year, however, since then the stock price has fallen 45%.
But that has not affected Saylor’s commitment to bitcoin, the company says they will buy more bitcoin in the future, and the sale of the junk bonds also took place for the same purpose.
Junk bonds are debt offerings by companies who want to raise money. These bonds do not have investment grade credit rating however, they do offer good return on investment with substantially more risk. Junk bonds usually offer around 6.125% to 6.25% return. Eclipsing the return by treasury bonds.
The news has had different responses from different people, bitcoin fanboys have shown a lot of support towards the decision while a lot of people have criticized the sale. Citing the fact that these bonds carry a lot of risks and are a bad investment for people.