MicroStrategy Will Raise $42 Billion to Buy Bitcoin
31 Oct, 2024 ● Coin news
Michael Saylor’s company, MicroStrategy, announced plans to raise $42 billion over the next three years to acquire more Bitcoin.
Referred to as the “21/21 plan,” this strategy will involve $21 billion in equity and another $21 billion in fixed-income securities through 2027, MicroStrategy disclosed on October 30.
At current market prices, $42 billion would allow the purchase of roughly 578,586 BTC, representing approximately 2.7% of the total Bitcoin supply.
MicroStrategy’s President and CEO, Phong Le, explained that this move aims to boost the company’s returns from holding Bitcoin.
“As a Bitcoin Treasury Company, we plan to use the additional capital to buy more Bitcoin as a treasury reserve asset in a manner that will allow us to achieve higher BTC Yield,” Phong noted.
The company reported a current BTC yield of 17.8% for the year, with a goal of reaching an annual BTC yield between 6% and 10% from 2025 to 2027.
Crypto commentator BitcoinMiningStockGuy responded positively to the news, highlighting that $21 billion "is like the total market cap of all the public miners combined."
Meanwhile, volatility researcher Ryan McGinnis described the plan as reaching “escape velocity,” adding, “The only question is how wide will the gap be between MSTR, every other PubCo on Earth combined, and even countries.”
This comment follows McGinnis’s March 6 statement that MicroStrategy represented a “Monopoly of Value.”
In September, MicroStrategy completed a $1.01 billion offering of 0.625% convertible senior notes due in 2028, intending to use part of the proceeds for Bitcoin acquisitions.
The private offering, which concluded on September 19, was aimed at institutional investors and allows conversion into cash or MicroStrategy stock.
Sources:
https://cointelegraph.com/news/microstrategy-42b-capital-bitcoin-purchase-michael-saylor
https://x.com/saylor/status/1851718391889043954
