The latest news from MicroStrategy’s headquarters talks about an increase in the company’s capital of $800 million, which by offering new securities to investors has managed to raise money to make another Bitcoin purchase.
With the latest addition of 12,000 BTC, MicroStrategy strengthens its position as the largest private company for held Bitcoin, reaching a total of 205,000 BTC.
Meanwhile, MSTR also continues its upward rally on the Nasdaq parallel to the excellent performance recorded by the cryptocurrency.
All the details below.
Summary
Latest crypto news: MicroStrategy buys more Bitcoin after raising $800 million in capital
MicroStrategy, the largest publicly traded company for Bitcoin, dropped a bombshell yesterday by stating that they have added a whopping 12,000 BTC to their treasury.
The purchase of new coins, as has been happening sporadically since September 2020, came this time after the business intelligence company, or as it prefers to define itself Michael Saylor “first bitcoin development company”, completed a securities offering to its investors.
This is an overall capital increase of about 800 million dollars, which after being approved by the SEC, allowed MicroStrategy to bring its stash to a record figure of 205,000 BTC, with a current value of 14.8 billion dollars.
As usual Saylor, CEO, has published the details of the deal on X informing the bitcoin community:
Regarding the offer of new securities, in the document filed with the United States Securities and Exchange Commission yesterday, it is clearly stated that the company used $781.1 million from its convertible bond offering, along with $40.6 million in cash, to purchase 12,000 BTC between February 26 and March 10 at an average price of $68,477 per bitcoin.
This type of bonds offers an annual interest rate of 0.625% with maturity on March 15, 2030.
However, they can still be sold, redeemed, or converted into MSTR ordinary class A shares or with a mix of cash and shares before the established date.
For days there had been talk of possible capital increases, with MicroStrategy and Saylor trying in every way to finance their own company as much as possible to acquire new digital coins, in the midst of hype and fomo among retail investors.
With Bitcoin in recent days seeming relentless, ready to give gas to every attempt at a bullish breakout, it was not difficult to find new customers interested in the products offered by the company.
It is worth noting that on March 8th, 3 days before filing the document with the SEC, MicroStrategy had completed a private offering of senior convertible securities with an initial value of $600 million.
As later explained by the company in the official statement in which the news was released to stakeholders:
“the offering of securities was well received in the market and was increased to a total of $800 million in aggregate capital. This amount included the exercise by the initial purchasers of their option to purchase an additional $100 million of securities. The net proceeds from the offering to MicroStrategy amount to approximately $782.0 million”.
At the time of writing the article, with Bitcoin prices indicating a price of 71,580 dollars per unit, MicroStrategy’s investment is in an unrealized gain of 113% for a total value of 7.86 billion dollars.
MicroStrategy Stocks: how is the stock performing on Nasdaq?
While the news on the stock market Nasdaq is about the capital increase of MicroStrategy and the offering of new securities, Bitcoin is flying on the market updating new all-time highs and stimulating the price action of Michael Saylor’s stock.
Indeed, just like the cryptocurrency par excellence, even the MSTR stock has marked new highs (not historical if we consider the bubble of the 00s) surpassing the high dated February 2021 around 1315 dollars per stock.
Currently, MicroStrategy’s stock is trading at a price of 1484 dollars but in the Nasdaq premarket it is already being traded at 1538 dollars.
Since January 2023 MSTR is up 915%, while since the beginning of 2024 it is “only” up 114%.
We expect a bullish continuation in the coming weeks, assuming Bitcoin continues its crazy race towards infinity.
This kind of results reflects the particularly positive financial situation of MicroStrategy, which in the latest quarterly data revealed an impressive gross profit margin of 77.85%.
Furthermore, it is clear that, holding Bitcoin on the balance sheet for an amount equal to 60% of the market capitalization of the stock, the price action of the cryptocurrency directly or indirectly influences that of the stock, and therefore they are strongly correlated.
The strong bullish momentum of the crypto has also led to speculations on MSTR converging in price growth phases.
The title MicroStrategy, while reflecting the exploits of digital gold, also moves according to the logic of the US stock market and shows a volatility even higher than its cryptographic counterpart.
We remember, in fact, that during the last bull run, from the peak of February 2021 to the low of December 2022, this stock resource had lost about 90% of its value, reaching $143 during the phases of max pain.
