As a seasoned crypto investor with a knack for spotting promising opportunities, I find MicroStrategy’s aggressive Bitcoin buying strategy quite intriguing. Having witnessed the meteoric rise of Bitcoin and its potential to revolutionize finance, I can’t help but admire their bold move.
In simpler terms, the software firm MicroStrategy has announced it will hold an extraordinary gathering for shareholders, aiming to broaden its scheme for issuing shares and potentially buy additional amounts of Bitcoin (BTC).
The company has filed a request on Dec 23rd with the Securities and Exchange Commission to allow an expansion of its total share count, which includes both Class A common stock and preferred stock. This move would grant them the ability to issue extra shares whenever required in the future, offering increased flexibility.
The first amendment seeks to raise the authorized Class A common stock from 330 million shares to 10.33 billion shares, while the second amendment aims to increase the authorized preferred stock from 5 million shares to over 1 billion shares.
MicroStrategy’s 21/21 Plan, unveiled in October, sets forth their intention to acquire an extra $42 billion in Bitcoin over the next three years. This ambitious plan aims to secure $21 billion through stock sales and another $21 billion by issuing fixed-income securities.
According to MicroStrategy’s filing:
“Proposals 1 and 2 for this Special Meeting request an increase in the authorized shares of the capital stock of the Company to support further implementation of our 21/21 Plan and future capital markets activity more generally as well as other corporate purposes.”
Since 2020, the company has consistently purchased Bitcoin on a regular basis. However, the pace of these acquisitions significantly increased following the announcement of a specific plan. In the month of December alone, they added an impressive 42,162 Bitcoins to their holdings, valued at more than $4 billion based on current market prices.
By the close of October, MicroStrategy disclosed that its Bitcoin earnings were sitting at a rate of 17.8%. Their aim is to increase this annual return to between 6% and 10% from 2025 up until 2027. Since that announcement, they have reportedly gathered approximately $13 billion through stock sales and an additional $3 billion through the issuance of convertible bonds.
According to the document, we’re advancing our 21/21 Plan at a pace that’s quicker than what was initially expected.
By December 22, the company along with its affiliates collectively held approximately 444,262 Bitcoins, valued at about $43.53 billion. These Bitcoins were purchased for a combined total of $27.7 billion, equating to an average price of roughly $62,257 per Bitcoin.
1) This year so far, the company’s shares on Nasdaq have risen by more than 422%, primarily due to their Bitcoin-focused strategy. The date of the upcoming shareholder meeting has not been disclosed yet. Their next earnings report is set for February 2, 2025.
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2024-12-25 00:18