Double down! MicroStrategy plans to sell $1 billion in stock to buy more Bitcoin
After announcing a $488 million bond issuance to purchase Bitcoin, the U.S. publicly traded company MicroStrategy stated in an SEC filing that it may further sell $1 billion worth of stock (MSTR) in the future, claiming the proceeds could be used as investment funds for Bitcoin.
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Expected to Sell One Billion Dollars in Stocks
MicroStrategy disclosed this news in the S-3 document submitted to the U.S. Securities and Exchange Commission (SEC) on Monday. The company stated that the stock sale will be conducted directly on the public market.
MicroStrategy Launches “At the Market” Securities Offering for Flexibility to Sell Up to $1 billion of its Class A Common Stock Over Time $MSTRhttps://t.co/qouK8pFmBF
— Michael Saylor⚡️ (@saylor) June 14, 2021
Furthermore, MicroStrategy indicated in the document that the proceeds from this issuance will be used for general corporate purposes, including acquiring Bitcoin:
“We intend to use the net proceeds from the sale of the Class A common stock offered hereby for general corporate purposes, including the acquisition of Bitcoin. We have not determined the specific uses of the net proceeds and, therefore, our management will retain broad discretion over the allocation of any net proceeds.”
However, the company also emphasized that since no additional interest or returns can be obtained from investing in Bitcoin, the ability of the company to generate investment returns from the net proceeds of this issuance used for investing in Bitcoin will depend entirely on whether the value of Bitcoin appreciates after the purchase.
According to documents from the U.S. Securities and Exchange Commission, as of June 4th, MicroStrategy holds a total of 92,079 BTC, with a current value of approximately $3.7 billion.
The documents show that the company's average purchase price of Bitcoin is around $24,450, which means the company has made a profit of approximately $1.5 billion from its Bitcoin investments.In addition to the $488 million raised through debt financing in June and the $1 billion in funds from the upcoming stock sale, the company will have nearly $1.5 billion available for investing in Bitcoin.