TL; DR Breakdown
- MicroStrategy is buying $500 million worth of Bitcoin
- The firm will sell shares to purchase a further $1 billion worth of BTC
- It’s good for the market
It appears that MicroStrategy, a firm that deals with business intelligence and has vast Bitcoin holdings, isn’t done buying yet. After pledging around $500 million to buying more BTC, MicroStrategy is now planning the next big move that could give it enough money to buy $1 billion worth of Bitcoin. The half a billion dollars came from the firm’s sales of senior debt notes.
The firm has notified the US SEC of its intent to launch a sale window for its class A common stock. It is partnering with Jeffery’s LLC. This arrangement is an Open Market Sale Agreement meant to allow MicroStrategy to sell shares via the intermediary. The sale windows can be opened and closed at any time. The company plans to dispose of a billion-dollar worth of shares and use the proceeds to purchase more Bitcoin. The CEO, Michael Saylor, broke the news in a tweet. The company has also detailed its plan in an official blog post.
MicroStrategy has been buying BTC in large numbers since August last year when the crypto’s price was still in the lower ranges. The firm is currently the top Bitcoin holder among publicly listed companies. It holds around 92, 079 BTC with estimated value of about $3.7 billion. MicroStrategy has made good profits from its crypto holds, having bought the coins at an average cost of $24,450 each. This could explain its renewed appetite to accumulate more Bitcoin especially now that the market looks bullish.
MicroStrategy’s CEO, Michael Saylor, has been an influential figure in the crypto community. He recently arranged a meeting between Tesla CEO Elon Musk and members of the Bitcoin Mining Council to find a way forward in the quest to introduce green energy in Bitcoin mining, an event that is to thank for the crypto’s current price recovery.
If MicroStrategy is to use the expected $1 billion to buy BTC, it will add roughly 25,000 BTC to its stash at the current cost of around $40k a piece. The continued accumulation by such big players will help keep BTC afloat and possibly fuel the next big bull run.