MicroStrategy to raise another $1,75 billion to buy bitcoins

What’s new? American analytics software company MicroStrategy (MSTR), which is the largest bitcoin holder among publicly traded firms, has revealed plans to increase its investment in the first cryptocurrency. For instance, MicroStrategy intends to conduct a $1,75 billion convertible senior notes offering and use the proceeds to buy bitcoins.

Press release

What else is known? The securities will be privately offered to institutional investors outside the United States. They are unsecured senior unsecured obligations with no interest accrual and mature on December 1, 2029. The notes can be converted into cash, MSTR Class A common stock, or a combination of both.

The company has already issued hundreds of millions of dollars worth of bonds multiple times this year to boost its investment in the first cryptocurrency.

The day before, MicroStrategy founder and chairman Michael Saylor said the company had made another bitcoin purchase: 51 780 coins worth $4,6 billion, or $88 627 per coin. This brings the amount of bitcoins on the company’s balance sheet to 331 200 coins purchased for $16,5 billion or $49 874 per BTC.

Considering the current bitcoin exchange rate, the value of MicroStrategy’s accumulations is over $30,38 billion and unrealized gains of $13,88 billion.

This transaction was the largest in the company’s history, both in terms of value and number of coins. Previously, the largest by volume was the company’s first BTC investment in December 2020 (29 646 coins), followed by the purchase of 27 200 coins on November 11 this year.

Source: X.com

Following the news, MSTR shares rose 13% overnight and hit an all-time high of $384,79. Since the beginning of the year, the company’s securities have repeatedly set new highs. A sharp rise began in August and intensified in November after Donald Trump’s victory in the US presidential election, which caused the growth of the entire crypto market and shares of cryptocurrency-related companies.

Overall, the value of MSTR has risen 455,66% since the beginning of the year. MicroStrategy by Saylor began investing in bitcoin in 2020 to hedge inflation. Since then, MSTR has outperformed the shares of all major technology companies, as well as the S&P 500 index, the basket of which includes the largest US firms by capitalization.

Other companies that have followed MicroStrategy’s lead and started buying bitcoin to hold on to their own balance sheets are also seeing their share prices rise. These include Japanese investment firm Metaplanet and US medical technology company Semler Scientific.

Analysts surveyed by Bloomberg called the high growth rate of MicroStrategy shares unreasonable

The company began investing in bitcoin in 2020, and since then, the value of its securities has risen by 1700%

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Last month, Saylor said MicroStrategy aims to become a leading bitcoin bank with powerful inflation hedging and long-term value storage tools.

At the same time, it became known that Microsoft shareholders would consider investing in BTC at a meeting on December 10. Saylor commented on the news, offering the corporation his help in increasing its capitalization by $1 trillion.

Also, Saylor supported the bill of Senator Cynthia Lummis on the creation of a national bitcoin reserve, in case of adoption of which the US authorities will purchase 1 million coins within five years. The entrepreneur is confident that this initiative will strengthen the country’s economy.