- In keeping with CEO Michael Saylor’s fervent belief in Bitcoin, the company sold Class A common shares to finance this acquisition.
MicroStrategy has once again made headlines by acquiring a significant amount of Bitcoin (BTC), a move that has become nearly habitual.
According to a Form 8-K filed with the U.S. Securities and Exchange Commission (SEC) on December 2, which is used by publicly traded corporations to disclose unanticipated substantial events or corporate changes, MicroStrategy paid roughly $1.5 billion in cash for 15,400 BTC.
Including fees and expenses, the business intelligence firm paid an average price of $95,976 per Bitcoin.
MicroStrategy’s Bitcoin return is now 38.7% for the quarter and 63.3% for the year as a result of this acquisition.
Bitcoin Accumulation Is Fueled by Strategic Stock Sales
Class A common stock was sold under a pre-existing sales agreement to finance this most recent acquisition. After subtracting sales commissions, MicroStrategy’s net proceeds from the sale of about 3.7 million shares between November 25 and December 1 came to almost $1.48 billion.
The sales agreement with several financial institutions permits the issuance and sale of shares valued at up to $21 billion, and this sale is a component of a larger plan.
The entire amount of Bitcoin that MicroStrategy has as of December 1st is 402,100 BTC, which was purchased for an approximate $23.4 billion total. When fees and costs are taken into account, this comes to an average price of $58,263 per Bitcoin.
The company now has about $11.3 billion worth of shares available for future transactions thanks to the sales agreement that was started on October 30 with TD Securities (USA) LLC and other sales agents.
The “Year of the Crypto Renaissance” will be 2025
MicroStrategy is still actively collecting Bitcoin. The business is strategically issuing shares to increase its bitcoin holdings in order to finance these acquisitions.
This tactic reinforces MicroStrategy’s standing as a major institutional Bitcoin investor and is consistent with CEO Michael Saylor’s outspoken advocacy for the cryptocurrency.
In a recent presentation regarding the company’s Bitcoin strategy, MicroStrategy refers to Bitcoin as “the highest performing uncorrelated asset that a corporation can hold on its balance sheet.”
MicroStrategy makes the prediction in the presentation that 2025 will be the “year of the crypto renaissance.” This forecast is based on expected events including the acceptance of Bitcoin exchange-traded funds (ETFs) by Wall Street, the broad use of fair value accounting for digital assets, and the support for Bitcoin by the incoming U.S. president and cabinet.
MicroStrategy anticipates that the creation of a “Bitcoin Strategic Reserve,” increased congressional support for cryptocurrencies, and a well-defined regulatory framework for digital assets in the United States would all contribute to this “renaissance.”
Although there are greater fluctuations, MicroStrategy’s stock (MSTR) is strongly correlated with the performance of Bitcoin. MSTR has increased by 513% this year, whereas Bitcoin has increased by 150%. This increased volatility was seen in November, when MSTR rose 58%, outpacing Bitcoin’s 37% monthly gain.
Bitcoin is being used by more businesses as an inflation hedge
There are more companies pursuing Bitcoin besides MicroStrategy. As a possible inflation hedge, an increasing number of businesses are include cryptocurrencies on their balance sheets.
On November 18, the artificial intelligence company Genius Group likewise followed suit, investing $10 million to buy 110 Bitcoin and declaring its plan to eventually retain up to 90% of its reserves in the cryptocurrency.
Additionally, between November 18 and 22, Semler Scientific, a tech solution provider, bought 297 Bitcoin coins for $29.1 million at an average price of $75,039 each, increasing its holdings to 1,570 BTC.
In keeping with this pattern, Japanese investment company Metaplanet intends to raise more than $62 million by purchasing more stocks.
This trend will continue as Japanese investment firm Metaplanet intends to fund more than $62 million through a stock acquisition plan in order to purchase additional Bitcoin, bringing its total holdings to 1,142.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
