On January 5th, Michael Saylor, co-founder of MicroStrategy, posted a chart from the SaylorTracker website, hinting at an impending Bitcoin acquisition on Monday. This move is part of MicroStrategy’s larger strategy to finance its $42 billion plan to acquire Bitcoin through issuing $21 billion in equity and $21 billion in fixed-income securities.
The SaylorTracker Chart: A Week-Old Revelation
Saylor posted the same chart a week ago, on Sunday, December 29th. Interestingly, MicroStrategy purchased 2,138 BTC at an average purchase price of $97,837 per coin on December 30th. This transaction was likely triggered by Saylor’s habit of posting the chart every Sunday before making a Bitcoin purchase.
The 21/21 Plan: Financing Bitcoin Acquisition
MicroStrategy is eyeing more purchases as part of its 21/21 plan to finance the acquisition of $42 billion in Bitcoin. The company plans to issue $21 billion in equity and $21 billion in fixed-income securities to fund this endeavor. This strategy marks a significant move by MicroStrategy to diversify its portfolio and capitalize on the growing demand for cryptocurrencies.
MicroStrategy’s Addition to the Nasdaq 100
On December 23rd, 2024, MicroStrategy entered the Nasdaq 100 – a weighted stock market index of the 100 largest companies on the Nasdaq exchange by market capitalization. This inclusion gives traditional stock investors holding the instrument through exchange-traded funds indirect exposure to Bitcoin.
Increased Shareholder Approval for Bitcoin Financing
Following its inclusion in the Nasdaq 100, MicroStrategy called a special shareholders meeting to increase the amount of shares to finance the purchase of Bitcoin for its corporate treasury strategy. According to a December 23rd filing with the Securities and Exchange Commission (SEC), MicroStrategy asked shareholders to approve an increase in class A common stock from 330 million shares to 10.3 billion shares.
Additional Authorization for Preferred Stock
The company also requested shareholder approval to increase authorized shares of preferred stock from 5 million shares to over 1 billion shares. This move is aimed at providing MicroStrategy with more flexibility in its capital structure and financing options.
Perpetual Preferred Offering: A Separate $2 Billion Raise
On January 4th, MicroStrategy announced that it was seeking a $2 billion raise through a perpetual preferred stock offering. This proposal will be separate from the company’s core 21/21 plan to finance the purchase of Bitcoin and is expected sometime in Q1 2024, pending approval from the company.
Key Takeaways
- MicroStrategy’s strategy to acquire $42 billion in Bitcoin through issuing $21 billion in equity and $21 billion in fixed-income securities marks a significant move by the company.
- The inclusion of MicroStrategy in the Nasdaq 100 provides traditional stock investors with indirect exposure to Bitcoin.
- The perpetual preferred offering is a separate $2 billion raise, expected sometime in Q1 2024.
Conclusion
MicroStrategy’s bold strategy to acquire a massive amount of Bitcoin has significant implications for the cryptocurrency market. As the company continues to execute its plans, investors and stakeholders will be closely watching its progress.