MicroStrategy’s ownership of Bitcoin’s total supply surpasses 1% mark.
MicroStrategy, led by Michael Saylor, has made a significant addition to its Bitcoin holdings by purchasing an additional 9,245 Bitcoins for $623 million this week. This brings their total Bitcoin holdings to 214,246, with an average purchase price of $35,160 per Bitcoin and a cumulative spending of $7.5 billion.
With this latest purchase, MicroStrategy now holds over 1% of the entire Bitcoin market, indicating an unrealized profit margin of approximately $6 billion.
To fund this substantial acquisition, MicroStrategy used two sources. $592.3 million was obtained through the company’s latest convertible debt offering, while the remaining $30.7 million was allocated from surplus cash reserves.
However, the announcement of this strategic move, coupled with the completion of a $603.7 million convertible debt offering, led to a 13% decline in MicroStrategy’s stock value on Tuesday. This drop was in line with the decrease in Bitcoin’s value. It’s worth noting that this acquisition follows closely after another convertible debt offering of $800 million, which was completed just the previous week.
MicroStrategy has outlined a unique plan to pay back its borrowed money before September 15, 2030. The company intends to allow investors to exchange the cash they lent for MicroStrategy’s shares, but there are specific rules governing this process.
Under these rules, for every $1,000 lent to MicroStrategy, investors will receive 0.43 of a MicroStrategy share. This means that if an organization lent the company $1,000, they could opt to receive shares worth approximately $2,327.21 instead of receiving cash.
MicroStrategy’s bold moves in the cryptocurrency market continue to attract attention, and it will be interesting to see how their investment strategy unfolds in the coming months.
