On Tuesday, MicroStrategy announced the acquisition of an additional 9,245 BTC for approximately $623.0 million, using proceeds from convertible notes and excess cash. This purchase brings the company’s total holdings to 214,246 BTC. This figure represents more than 1.0% of the total 21 million Bitcoin that will ever exist, marking a significant milestone for both MicroStrategy and the community at large.
Michael Saylor, the CEO of MicroStrategy, shared the news on X (formerly Twitter), stating, “MicroStrategy has acquired an additional 9,245 BTC for ~$623.0M using proceeds from convertible notes & excess cash for ~$67,382 per #bitcoin. As of 3/18/24, MSTR hodls 214,246 BTC acquired for ~$7.53B at average price of $35,160 per bitcoin.”
The funding for this significant acquisition came from a private offering of convertible senior notes, which concluded with an upsized aggregate principal amount of $603.75 million. This offering attracted substantial interest, leading to an oversubscription and the exercise of an option by initial purchasers to buy an additional $78.75 million worth of notes.
According to MicroStrategy’s official press release, “The Offering, which included a 0.875% coupon and an approximately 40% conversion premium over the US composite volume weighted average price of MicroStrategy’s class A common stock, was well received in the marketplace.”
The convertible notes, due in 2031, offer flexibility to holders with rights for early repurchase and conversion into cash, shares of MicroStrategy’s class A common stock, or a combination thereof under specific conditions. This innovative financial instrument reflects MicroStrategy’s sophisticated approach to capital management and its bullish outlook on Bitcoin.
The Bitcoin Community Reacts
The community has lauded MicroStrategy’s latest acquisition. Bitcoin Munger commented, “Saylor is like a kid in a candy store with this current dip. Still surprised that the market would give him this dip, but coins are moving from lettuce hands to diamond hands.”
Furthermore, prominent figures like Dylan LeClair and WhalePanda have acknowledged the company’s significant market position, with LeClair stating, “>1.0% of 21,000,000 Bitcoin. Congrats Saylor & MicroStrategy. Legendary,” and WhalePanda adding, “Saylor thanks you for your weak hands.”
MicroStrategy’s aggressive accumulation of BTC not only demonstrates its confidence in the digital currency as a viable investment asset but also could have significant impact on market dynamics. This milestone of holding more than 1% of all BTC’s in existence is a monumental step for Saylor.
More recently, Michael Saylor’s bet on BTC was compared to Nelson Bunker Hunt’s historical attempt to corner the silver market. Both invested heavily with the conviction that their chosen asset (BTC for Saylor, silver for the Hunts) was undervalued and poised for significant appreciation. Each believed strongly in the future value of their chosen asset, seeing it as a hedge against economic uncertainty and inflation.
#Bitcoin as a protest to fiscal absurdity, the flaw of analogizing industrial commodity squeezes of the past, and the empowerment of self custody. pic.twitter.com/wJ0WBqLWYa
— Dylan LeClair
(@DylanLeClair_) March 13, 2024
In a recent interview, Saylor proclaimed that he has no plans to sell BTC. “We think Bitcoin is the highest form of property, the apex property in the world, and it’s the best investment asset, so the end game is to acquire more Bitcoin. Whoever gets the most Bitcoin wins. There is no other end game,” Saylor said.
At press time, BTC traded at $63,723.
