The company owned 214,400 bitcoins which, at today’s prices, assuming no changes in the size of the holding, would be worth approximately $14 billion. Any BTC purchases in the second quarter would mark 15 consecutive quarters of the company purchasing the cryptocurrency.
MicroStrategy shares fell 9% during the same period.
MicroStrategy (MSTR) seeks to increase your Bitcoin (BTC) reserve and is collecting US$500 million in debt to facilitate the purchase, along with other corporate purposes, as announced by the company in the last few hours.
The debt offering consists of convertible senior notes due 2032 and will be open to qualified institutional buyers (QIBs), with a 13-day option for initial investors to purchase up to an additional $75 million in notes. These senior unsecured notes will bear interest semiannually, beginning December 15, 2024until maturity, unless repurchased, redeemed or converted at an earlier date.
MicroStrategy’s commitment to Bitcoin in recent years
MicroStrategy has become famous for its strategy focused on the world’s largest cryptocurrency by marketcaop, led by its CEO Michael Saylor, as of April 26, the company owned 214,400 bitcoins which, at today’s prices, assuming no changes in the size of the holding, they would be worth approximately US$14 billion.
Any BTC purchases in the second quarter would mark 15 consecutive quarters of the company purchasing the cryptocurrency.
Although other companies such as Tesla (TSLA), Block (SQ) and, more recently, Semler Scientific (SMLR) have confirmed the purchase of cryptocurrencies, none have a reserve in Bitcoin not even remotely close to the size of MicroStrategy’s.
And, in that sense, the shares of none of the other Bitcoin investing companies exhibit a correlation with BTC prices, as much as the shares of MicroStrategy.
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While the price trend lines for Bitcoin and MicroStrategy appear to move in unison, MicroStrategy stock has been ahead of the cryptocurrency since February, practically coinciding with the company’s announcement on February 26 to add 3,000 bitcoins to its portfolio.
So far this year, Bitcoin prices are up roughly 50%, while MicroStrategy stock has more than doubled.
But this correlation also works in a negative way. The price of Bitcoin is down approximately 6% over the past week, despite a short-lived recovery following the release of the US Consumer Price Index (CPI) on Wednesday. MicroStrategy shares fell 9% during the same period.
Source: Ambito
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