MicroStrategy Buys 55,500 BTC for $5.4B, largest in history

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As a seasoned analyst with years of market observation under my belt, I must admit that MicroStrategy’s latest Bitcoin acquisition strategy is nothing short of audacious and intriguing. The company’s relentless pursuit of Bitcoin, even amidst significant capital-raising initiatives, is reminiscent of a gold rush prospector staking claims left and right.

In simpler terms, the business intelligence company, MicroStrategy, known for its significant Bitcoin holdings, just purchased another 55,500 Bitcoins at around $5.4 billion.

As documented in an 8-K form submitted to the SEC, the transaction occurred between November 18th and November 24th, with the average price paid being approximately $97,862 per Bitcoin. This is the company’s largest Bitcoin purchase ever, coming after a sequence of substantial fundraising efforts.

On November 21st, MicroStrategy finalized a $3 billion bond sale, yielding approximately $2.97 billion in total earnings. Simultaneously, they offloaded around 5,597,849 of their own shares at a value of about $2.46 billion.

The business intends to gather approximately $42 billion through various methods over the next three years. This will involve selling around $21 billion worth of stocks (equity offerings) and issuing $21 billion in bonds (fixed-income securities). These funds are intended to finance potential future Bitcoin purchases.

Currently, MicroStrategy owns around 386,700 Bitcoins, which are worth more than $37 billion. The company has invested about $21.9 billion in purchasing Bitcoins, with an average cost of roughly $56,761 per Bitcoin, taking into account transaction fees and other expenses.

The business assesses its success by means of a unique “Bitcoin Growth Rate” metric, representing the proportion shift in Bitcoin assets as compared to their diluted stocks. Currently, the year-to-date Bitcoin Growth Rate stands at 59.3%, suggesting strong expansion in Bitcoin holdings despite controlling share dilution.

As a researcher, I find myself reflecting on MicroStrategy’s recent strategic move to acquire 55,500 Bitcoins for approximately $5.4 billion. This latest purchase is a continuation of their aggressive Bitcoin buying spree, with the acquisition of 51,780 BTC for $4.6 billion just last week at an average price of roughly $88,627 per coin, and another $2 billion worth a week prior, where they paid an average of around $74,463 per coin.

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2024-11-25 17:56