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In summary
- MicroStrategy, the largest holder of corporate Bitcoin reserves with more than $14 billion, announced on Monday that it plans to purchase more Bitcoin as part of a private offering of $700 million in convertible senior notes.
- The company will use the proceeds from the sale to redeem $500 million in previously issued senior secured notes due in 2028 and to purchase more Bitcoin.
- MicroStrategy now owns 244,800 Bitcoin, roughly $14.2 billion, and its shares are up more than 800% since it began including the digital asset on its balance sheet.
MicroStrategy, the largest holder of corporate Bitcoin reserves with more than $14 billion, announced on Monday that it plans to purchase even more Bitcoin as part of a private offering of $700 million in convertible senior notes.
The company said it will use the proceeds from the sale to redeem $500 million in previously issued senior secured notes due in 2028, at an expected total cost of $523.8 million, including interest. MicroStrategy then plans to use any remaining proceeds to purchase more Bitcoin and for general corporate purposes.
Senior bonds are a form of debt that a company can issue to investors. Convertible bonds can be converted into shares of the company by the buyer. MicroStrategy uses the issued debt to buy more Bitcoin.
MicroStrategy now owns 244,800 Bitcoin, roughly $14.2 billion, after announcing its most recent purchase on Friday.
At the time of writing, Bitcoin is trading for $57,661 per coin, according to data from CoinGecko. It hit an all-time high of $73,737 in March.
MicroStrategy first bought Bitcoin in 2020. Former CEO and current chairman of the company, Michael Saylor, says the strategy is the best way to preserve wealth and generate returns for shareholders.
And so far, so good: MicroStrategy (Nasdaq: MSTR) shares are up more than 800% since it began including the digital asset on its balance sheet, while its Bitcoin is collectively worth 50% more than what it paid for it based on the average cost per coin.
The company now classifies itself as a “Bitcoin development company” and investors are buying shares in the software company to gain exposure to the largest and oldest digital currency.
Saylor has said that his company’s strategy “is to buy and hold Bitcoin, and the key for us is to be consistent, transparent and accountable in pursuing that strategy.”
Editor’s note: This story was updated after publication with additional details.
Edited by Andrew Hayward
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