Key Takeaways
- MicroStrategy has purchased another $1.1 billion worth of bitcoin for its treasury, which brings its total holdings to 461,000 bitcoin.
- This is the eleventh week in a row MicroStrategy has announced a bitcoin purchase.
- Investors will vote Tuesday to increase MicroStrategy’s Class A and preferred stock to enhance its ability to buy more bitcoin.
MicroStrategy (MSTR) bought another $1.1 billion of bitcoin (BTCUSD), its largest purchase in more than a month and its 11th consecutive week of buying.
The company added 11,000 BTC to its holdings, bringing its total to 461,000 bitcoin worth roughly $47 billion at current prices. It financed this latest acquisition through the issuance and sale of shares.
Selling Shares To Add To Bitcoin Stash
MicroStrategy’s bitcoin buying playbook has included selling shares or leveraging debt to fund purchases. Last year, it announced plans to raise $42 billion over three years using those methods to build its bitcoin book. It expanded that goal by $2 billion earlier this year.
On Tuesday, MicroStrategy voters will cast their ballots to decide whether the company should increase authorized shares of class A common stock to 10.3 billion from 330 million and its authorized preferred stock to 1 billion from 5 million. If that vote goes through, it will add to MicroStrategy’s ability to use share sales to buy more bitcoin. As of Jan. 21, MicroStrategy has roughly $5.42 billion left in equity available to issue under its current capital plan.
MicroStrategy’s bitcoin acquisition strategy has not come without criticism. Some investors question the risks tied to its approach based on debt and equity issuance. But it has inspired other listed companies, such as bitcoin miner Marathon Digital (MARA), to follow its bitcoin treasury blueprint.
The company’s stock fell as much as 7% in early trading but recovered a little to trade 3% lower in recent trading. Over the past year, MicroStrategy shares have gained more than 690%.
