Key Takeaways:
- MicroStrategy now owns more than 100,000 Bitcoins after its latest Bitcoin acquisition
- The software firm now has over $3bn of its market value in the Bitcoin
Michael Saylor’s MicroStrategy has completed its latest bond sale and used the proceeds amounting to $489mn to purchase more Bitcoin. Read more to see what’s Mr. Saylor’s next bold move.
The Software Firm Has Completed Its Third Bond Sale Round
MicroStrategy, the software company famous for its bold Bitcoin purchases, confirmed last week it has successfully acquired another large portion of tokens of the world’s biggest cryptocurrency. The latest purchase round for the Virginia-based software firm was completed on June 21.
A statement, released by the company on their blog page revealed MicroStrategy had spent $489mn to acquire 13,005 bitcoins at an average price of $37,617 per Bitcoin. In fact, the enterprise software firm, led by arguably the most devoted Bitcoin evangelist, Michael Saylor, now owns 105,085 Bitcoins. They are valued at an average of $26,080 apiece.
Earlier in June, Mr. Saylor announced his company was looking to raise about $500mn through a bond sale and use the proceeds to increase its Bitcoin holdings. Thus, the latest purchase round was the company’s third bond sale. MicroStrategy’s move aimed to borrow millions of dollars that would be converted to Bitcoin.
Bitcoin Represents Roughly 65%, or $3bn, of MicroStrategy’s Market Value
MicroStrategy’s Bitcoin trove is currently worth around $3bn and takes up about 65% of the firm’s market capitalization which sits around $5bn. Therefore, the total amount of money spent by MicroStrategy on acquiring Bitcoin represents about half of the market value of the company, or $2.74bn. However, this puts the company’s financial health at risk if the price of Bitcoin slides lower than the average purchase price of the entire Bitcoin stash that’s now part of MicroStrategy’s balance sheet.
“We rotated our shareholder base and transformed ourselves into a company that’s able to sell enterprise software and to acquire and hold Bitcoin, and we’ve done it successfully with leverage,” Michael Saylor said in an interview.
The firm’s risky Bitcoin bet has been going for almost a year. MicroStrategy’s Michael Saylor, began to acquire Bitcoin aggressively in the summer of 2020. Saylor still continues to rack up large quantities of the digital asset. Meanwhile, the entrepreneur remains an outspoken Bitcoin supporter on Twitter.
Mr. Saylor’s Bitcoin pursuits are unlikely to end with the latest purchase. MicroStrategy has filed for a program that could allow the selling of $1bn worth of additional stock. Accordingly, the proceeds from which will be used to hoard more Bitcoin.
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