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MicroStrategy Bucks Trend: Buys $835M Bitcoin Amidst Plunge
20 Nov
Summary
- MicroStrategy's stock dropped 30% in one month due to Bitcoin's selloff.
- Despite the downturn, the company acquired an additional 8,178 BTC.
- MicroStrategy needs to raise $2 billion non-dilutive capital by year-end.
MicroStrategy's stock has experienced a sharp 30% decline over the past month, largely attributed to a significant selloff in Bitcoin markets. Despite this market turbulence, the company's leadership continues to aggressively increase its Bitcoin holdings. Last week alone, MicroStrategy added 8,178 BTC, valued at $835.6 million, to its treasury, now possessing a total of 649,870 BTC with an average cost price of $74,433 per Bitcoin.
The company's aggressive strategy, which involves accumulating Bitcoin as a treasury asset, faces scrutiny as market volatility tests investor conviction. MicroStrategy's ambitious goal is to achieve a 30% BTC yield by year-end. To reach this target with less than two months remaining in 2025, the company must secure around $2 billion in non-dilutive capital, a challenging feat given the recent market downturn and its stock trading below its all-time high.
MicroStrategy is implementing an innovative capital markets strategy, described as a 'credit factory,' to fund its Bitcoin accumulation. Moving beyond traditional convertible debt, the company has successfully raised $19.8 billion this year. A significant portion, 30% of this total, came from four newly launched preferred equity offerings, collectively amounting to $6.7 billion, demonstrating a diversified approach to capital raising.
