MicroStrategy refused to sell bitcoins to secure loans

Michael Saylor stressed that the company has the ability to service its current loans

11.05.2022 - 09:35

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What’s new? MicroStrategy has no plans to sell bitcoins from its cryptocurrency reserves to secure previously taken loans. This was announced by the company’s head Michael Saylor on his Twitter account.

MicroStrategy has a $205M term loan and needs to maintain $410M as collateral. $MSTR has 115,109 BTC that it can pledge. If the price of #BTC falls below $3,562 the company could post some other collateral. See slides 11-12 in Q1 2022 presentation. #HODL https://t.co/9WHsIB6Usx— Michael Saylor⚡️ (@saylor) May 10, 2022

What other statements have been made? According to Saylor, the company has enough assets to secure loans. MicroStrategy can pledge 115 109 bitcoins (about $3,56 billion at the exchange rate on May 11) to secure a $205 million term loan. This amount will be sufficient until the bitcoin price falls below $3562. If the price falls even lower, the company could post another collateral, Michael Saylor stressed.

What events happened before? In March 2022, MacroStrategy, a subsidiary of MicroStrategy, entered into an agreement with Silvergate Bank for a $205 million loan. All of the funds were used to buy bitcoins.

On April 26, MicroStrategy joined the Fidelity Investments custodial platform’s program, which offers the company’s employees the opportunity to invest their retirement savings in bitcoin.

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