MicroStrategy, led by Michael Saylor, has once again made a substantial investment in Bitcoin. The company recently acquired 11,931 BTC at a cost of approximately $786 million. This information was disclosed in a Form 8-K submission to the SEC. To finance this purchase, MicroStrategy conducted a private placement of convertible notes, which was finalized on June 18, 2024. The offering, which was initially intended to raise $700 million, was increased to $800 million due to strong market demand. The offering featured a 2.25% coupon and a conversion premium of 35% over the average price of MicroStrategy’s class A stock. The net proceeds from the offering amounted to around $786 million.
MicroStrategy used these funds, in addition to surplus cash, to buy Bitcoin between April 27, 2024, and June 19, 2024. The average purchase price for the BTC was $65,883 per coin. As a result of this recent acquisition, MicroStrategy and its subsidiaries now collectively own 226,331 Bitcoin, which was obtained at a total cost of approximately $8.33 billion. The average purchase price for their Bitcoin holdings, including fees and expenses, is approximately $36,798 per coin.
MicroStrategy has demonstrated its bullish stance on Bitcoin. With the current price of Bitcoin at $64,876, the company’s holdings are now valued at $14.68 billion, resulting in an unrealized profit of $6.35 billion. It’s worth noting that during the bear market of 2022, when Bitcoin’s price dropped below $20,000, MicroStrategy experienced losses on its Bitcoin investment. However, the recent market turnaround has changed the company’s fortunes.
MicroStrategy’s commitment to investing in Bitcoin reflects its confidence in the asset’s role as a reliable store of value. Chairman Michael Saylor has consistently advocated for Bitcoin, viewing it as a hedge against inflation. Despite the volatility of the cryptocurrency market, with BTC currently trading below the $65,000 support, MicroStrategy remains optimistic about the long-term prospects of Bitcoin. The company’s strategy involves using Bitcoin as its primary treasury reserve asset, a unique approach among publicly traded companies. MicroStrategy has previously made significant Bitcoin purchases, including $632 million worth on March 19 and 12,000 BTC for $821 million on March 11. They also acquired an additional 3,000 tokens in February.
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