MicroStrategy plans $2 billion raise via preferred stock offering to expand Bitcoin holdings

MicroStrategy, the largest corporate Bitcoin holder, plans to raise $2 billion from a perpetual preferred stock offering to purchase extra Bitcoin for the company to move closer to its “21/21” plan.

The firm explained in a statement that it plans to obtain the perpetual preferred stock by converting its class A common stock, paying a cash dividend, redeeming shares, or a combination of these.

Michael Saylor’s MicroStrategy is exploring various strategies to ensure adequate funds for crypto purchase

MicroStrategy is exploring different strategies to raise money for its Bitcoin stocking endeavor. It is currently planning to raise $21 billion in equity and $21 billion in fixed-income instruments. This plan has been implemented recently, leading to a sustained Bitcoin buying spree through senior convertible notes and debt.

The perpetual preferred stock offering, the latest strategy the firm is exploring to strengthen its balance sheet and acquire more Bitcoin, will begin implementation in Q1 2025. Yet MicroStrategy explained that it reserves the rights and has the sole authority to choose whether to proceed with and consummate the offering based on market status and other conditions.

The perpetual preferred stock offering is among the most privileged MicroStrategy class A common stock. If the company faces bankruptcy or liquidation, its holders will be given priority.

MicroStrategy’s Bitcoin reserve is valued at $43.9 billion

According to Bitcoin Treasuries, the business intelligence firm has 446,400 Bitcoins in its reserve, valued at $43.9 billion. In 2024, the firm improved its Bitcoin purchasing power, acquiring 257,250 BTC, making it the highest-buying year ever. The statistics show that the firm’s 446,400 Bitcoins were bought at an average price of $62,500. This implies that MicroStrategy is up 57.2% on its Bitcoin investment. 

Michael Saylor, the firm’s executive chairman and co-founder, initiated the Bitcoin investment strategy, paving the way for corporate Bitcoin adoption worldwide. The co-founder’s Bitcoin strategy has positively impacted MicroStrategy (MSTR) shares. The shares have surged 13.2% on Jan. 3 to $339.6, which translates to a 438% rise from last year. MSTR has marginally fallen 0.19% since the firm’s perpetual preferred stock offering plan was announced in after-hours.