On Tuesday, MicroStrategy announced the acquisition of an additional 9,245 btc for approximately $623.0 million, using proceeds from convertible notes and excess cash. This purchase brings the company's total holdings to 214,246 btc. This figure represents more than 1.0% of the total 21 million bitcoin that will ever exist, marking an important milestone for both MicroStrategy and the community at large.
Michael Saylor, CEO of MicroStrategy, shared the news on As of 03/18/24, MSTR holds 214,246 btc acquired for ~$7.53 billion at an average price of $35,160 per bitcoin.”
Financing for this significant acquisition came from a private offering of convertible senior notes, which concluded with an increased aggregate principal amount of $603.75 million. This offering attracted substantial interest, leading to oversubscription and the exercise of an option by the initial purchasers to purchase an additional $78.75 million worth of bonds.
According to MicroStrategy official Press release“The offering, which included a 0.875% coupon and a conversion premium of approximately 40% over the composite volume-weighted average price of MicroStrategy's U.S. Class A common stock, was well received in the market” .
The convertible notes, due 2031, offer flexibility to holders with early repurchase rights and conversion into cash, MicroStrategy Class A common stock or a combination thereof under specified conditions. This innovative financial instrument reflects MicroStrategy's sophisticated approach to capital management and its bullish outlook on bitcoin.
The bitcoin community reacts
The community has praised MicroStrategy's latest acquisition. bitcoin Munger commented, “Saylor is like a kid in a candy store with this current downturn. She still surprises me that the market gives her this drop, but the coins are going from the hands of lettuce to the hands of diamonds.”
Additionally, prominent figures such as Dylan LeClair and WhalePanda have recognized the company's important market position, with LeClair indicating, “>1.0% of 21,000,000 bitcoin. Congratulations Saylor and MicroStrategy. Legendary” and WhalePanda adding“Saylor thanks you for your weak hands.”
MicroStrategy's aggressive accumulation of btc not only demonstrates its confidence in the digital currency as a viable investment asset, but could also have a significant impact on market dynamics. This milestone of owning over 1% of all existing btc is a monumental step for Saylor.
More recently, Michael Saylor's bet on btc was compared to Nelson Bunker Hunt's historic attempt to corner the silver market. Both invested heavily with the belief that their chosen asset (btc for Saylor, silver for the Hunts) was undervalued and primed for significant appreciation. Each believed strongly in the future value of their chosen asset, seeing it as a hedge against economic uncertainty and inflation.
bitcoin?src=hash&ref_src=twsrc%5Etfw” rel=”nofollow noopener” target=”_blank”>#bitcoin as a protest against fiscal absurdity, the error of making analogies with the restrictions on industrial products of the past and the empowerment of self-custody. pic.twitter.com/wJ0WBqLWYa
—Dylan LeClair (@DylanLeClair_) March 13, 2024
In a recent interview, Saylor proclaimed that he has no plans to sell btc. “We believe that bitcoin is the highest form of property, the pinnacle property in the world, and it is the best investment asset, so the ultimate goal is to acquire more bitcoin. Whoever gets the most bitcoin wins. There is no other ending,” Saylor said.
At the time of publication, btc was trading at $63,723.
Featured image from YouTube/Yahoo Finance, chart from TradingView.com
