MicroStrategy has announced plans to sell over $700 million in shares in a move that could further expand its already impressive Bitcoin portfolio, aligning with the firm’s founder Michael Saylor’s vision of cryptocurrency as a pivotal asset class.
This plan was unveiled in the company’s Q2 financial results on Tuesday. The results shed light on MicroStrategy’s continuous Bitcoin accumulation journey and showed that the company acquired an additional 12,800 Bitcoins, amounting to $361.4 million, during the second quarter.
Earlier this week, Saylor disclosed that they acquired an additional 467 BTC for $14.4 million in July. This latest purchase increased its total Bitcoin holdings to an impressive 152,800 Bitcoins, acquired at an average cost of $29,672 per Bitcoin. The substantial investment also represents a total expenditure of $4.53 billion, per the financial report.
Firm To Purchase More Bitcoin
The company also intended to raise $750 million by issuing up to 13,835,417 shares of class A common stock to investors at a target average price of $437.88 per share. The company further noted it intends “to use the net proceeds from this offering for general corporate purposes, including the acquisition of bitcoin and working capital, and, subject to market conditions, for the repurchase or repayment of our indebtedness.”
MicroStrategy’s unique role in the market is highlighted by its function as a gateway for institutional investors seeking exposure to Bitcoin. MicroStrategy has emerged as a vital alternative without an approved Bitcoin ETF in the United States. Institutional investors, constrained by portfolio regulations, view MicroStrategy as a strategic vehicle for accessing Bitcoin-related investment products.
This institutional demand ultimately means it could be easier for MicroStrategy to sell its shares while scooping up more coins before an ETF is approved. MicroStrategy’s Chief Financial Officer Andrew Kang underscored the company’s notable strides.
“Our bitcoin holdings increased to 152,800 bitcoins as of July 31, 2023, with the addition of 12,333 bitcoins in the second quarter marking the most substantial quarterly surge since Q2 2021,” Kang elaborated.
According to him, this growth trajectory was facilitated by the company’s adept utilization of its at-the-market equity program, coupled with the prudent utilization of operational cash. He further noted that these efforts unfolded against a backdrop of burgeoning institutional interest, advances in accounting transparency, and evolving regulatory clarity for Bitcoin.