As a seasoned investor with over two decades of experience under my belt, I must say that MicroStrategy’s bold move to raise $42 billion over the next three years to accumulate more Bitcoin is nothing short of audacious. Having witnessed the tech boom and bust, as well as the crypto winter and spring, I can’t help but feel a sense of nostalgia mixed with anticipation.
According to Michael Saylor’s MicroStrategy, they plan to gather approximately $42 billion within the next three years in order to acquire additional Bitcoins, as they have recently disclosed.
The “21/21 plan” refers to an investment strategy, which involves allocating approximately $21 billion in stocks and $21 billion in bonds over the following three years, as per a statement issued by MicroStrategy on October 30th.
Currently, when Bitcoin is published, roughly 578,586 Bitcoins are worth about $42 billion, which represents around 2.7% of the entire Bitcoin circulation.
Move to capitalize on BTC returns
Phong Le, MicroStrategy’s president and CEO, stated that the decision was made to strengthen the company’s earnings derived from owning Bitcoin.
Phong, representing our Bitcoin Reserve Corporation, shared that the extra funds we’ve acquired will be invested in purchasing more Bitcoins for our reserve assets. This strategy is intended to boost our Bitcoin returns or yield,” Phong explained.
According to recent reports from MicroStrategy, their Bitcoin earnings so far this year stand at approximately 17.8%. Their strategic goals aim to raise their annual Bitcoin returns to a range of 6% to 10% by the years 2025-2027.
BitcoinMiningStockGuy expressed optimism following the news, noting that the $21 billion figure was roughly equivalent to the combined market capitalization of all publicly traded mining companies.
Meanwhile, Ryan McGinnis, a researcher specializing in quant volatility, offered his thoughts, using the term “escape velocity” to describe the proposed plan.
The real question lies in determining the extent of the divide that will exist among MSTR, all public companies globally aggregated, and nations themselves.
It comes only months after McGinnis’ comments on March 6 that MicroStrategy is a “Monopoly of Value.”
MicroStrategy’s recent convertible senior notes plan
In September, MicroStrategy concluded a roughly $1.01 billion sale of convertible senior notes with a maturity date of 2028, carrying an interest rate of 0.625%. The company intends to apply some of these funds towards purchasing Bitcoins.
The private sale, wrapping up on September 19th, was specifically designed for institutional investors, providing them with the option to exchange funds or MicroStrategy shares.
In a more current development, as per CryptoMoon’s report on October 25th, MicroStrategy has shown a staggering increase of over 1,500% from its value in 1999, contrasted with Microsoft’s growth of around 1,460% over the same 25-year span.
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2024-10-31 03:23