MicroStrategy Inc. has taken a significant step in expanding its Bitcoin holdings, purchasing $4.6 billion worth of the cryptocurrency in a move that aligns with the company’s ongoing strategy to use Bitcoin as a treasury asset.
The enterprise software company acquired approximately 51,780 Bitcoin between November 11 and November 17, bringing its total holdings to around 331,200 Bitcoin, valued at about $30 billion. This purchase is part of a broader plan announced last month to tap the stock market to fund further acquisitions of Bitcoin.
To finance this record purchase, MicroStrategy sold 13.6 million shares of its stock in a transaction that occurred over the week ending November 17. These sales are part of a larger $21 billion equity offering designed to raise funds for Bitcoin investments. The strong demand for the company’s stock, reflected in the scale of the sales, signals investor confidence in MicroStrategy’s Bitcoin-centric strategy. This transaction is also one of the largest “at-the-market” offerings, which involves selling shares directly to investors through brokers, without requiring a fixed price.
MicroStrategy’s stock has been performing exceptionally well, up more than 400% year-to-date, making it one of the top performers in the market. The company’s focus on Bitcoin as a hedge against inflation began in 2020 when co-founder Michael Saylor decided to prioritize the cryptocurrency as a core part of the firm’s strategy. Initially, MicroStrategy funded its Bitcoin purchases using cash, but has since shifted to leveraging equity and convertible debt to continue accumulating the digital asset.
The company’s stock surged 13% on the day news broke about the $4.6 billion Bitcoin purchase, reaching a new all-time high. As a result of this rally, technical indicators are projecting further upside potential for the stock, with analysts setting a price target of approximately $525 per share. However, investors are also advised to monitor key support levels, particularly around $180 and $115, which could serve as potential buying opportunities if the stock experiences a pullback.
Bloomberg and Investopedia contributed to this report.
