MicroStrategy (MSTR), the world's largest corporate holder of Bitcoin, saw its shares rise 13.22% on January 4 after announcing plans to raise $2 billion in capital.
The preferred stock offering underscores the company's unwavering commitment to expanding its Bitcoin portfolio.
It is a strategy that continues to attract the attention of the market and drive its valuation higher.
$2 billion to support Bitcoin ambitions
The newly announced offer is part of the company's complex '21/21' strategic plan which is designed in two phases.
This ambitious goal is to move $42 billion within three years: $21 billion of equity and $21 billion of fixed income instruments.
The money will be sent to the company's balance sheet and deepened by Bitcoin.
– Notice –
As of January 4, MicroStrategy holds 446,400 BTC, worth approximately $43.9 billion, according to Bitcoin Treasuries. The company's average purchase price of $62,500 per Bitcoin is being set with a 57.2% profit invested.
A preferred stock offering gives holders priority over common stock in the event of liquidation or bankruptcy.
Although the company has refrained from providing this specific detail, the offer is expected to take place within the current quarter under favorable market conditions.
MicroStrategy stocks have rebounded in spectacular fashion once again. Avid investors lapped up the capital raising news, sending the stock up 13.22% on January 4, landing at $339.66 per share.
Over the past year, MSTR is up 395.75% compared to Yahoo Finance. That's far more than the 122.21% increase in Bitcoin's value.
The rally reflects investors' optimism regarding MicroStrategy's aggressive Bitcoin move led by Executive Chairman Michael Saylor.
Saylor has been one of the bullish proponents of Bitcoin as an investment for finance. He has described it as financial insurance against inflation and as a better form of money.
During his tenure, the company has been using debt securities such as convertible senior notes to finance its high a.OK, aggressive Bitcoin purchases.
Microstrategy's Bitcoin investments continue to grow
In 2024 alone, MicroStrategy added 257,250 BTC to its reserves, the largest acquisition year to date. The latest purchase of 2,138 BTC brought his total holdings to 446,400 BTC, cementing his position as the corporate leader of Bitcoin.
The company's commitment to collecting Bitcoin at scale has made it a key figure in the cryptocurrency market. Its “21/21” strategy aims to advance these efforts, presenting a long-term vision that prioritizes decentralized funds over traditional financial instruments.
While the market responded positively to the news of the capital raising, there are still concerns about the potential risks of relying heavily on Bitcoin.
Some analysts have questioned the sustainability of MicroStrategy's strategy, citing the potential for shareholder dilution or financial overreach.
Despite these concerns, the January 4 rally suggests that investors are optimistic about the company's ability to execute its plan and deliver long-term value.
MicroStrategy's approach continues to redefine corporate finance strategies, with Bitcoin at the heart of its operations.
Saylor's leadership has positioned the company as a pioneer in the adoption of digital assets, encouraging other institutions to explore Bitcoin as a viable alternative to traditional assets.
Source: https://www.thecoinrepublic.com/2025/01/05/microstrategy-stock-surges-13-amid-2-billion-bitcoin-plan/
