Business intelligence software provider 'MicroStrategy' has once again made significant Bitcoin purchases! According to documents submitted to the U.S. SEC on Monday, MicroStrategy spent $1.5 billion to acquire 15,350 Bitcoins from December 9 to 15, at an average price of $100,386.
The funds for this Bitcoin purchase by MicroStrategy mainly come from selling over 3.88 million shares of company stock during the same period, generating exactly $1.5 billion in revenue.
As of December 15, MicroStrategy still has approximately $7.65 billion worth of stock available for sale, which is part of the company's $21 billion stock issuance plan and $21 billion fixed-income securities issuance plan. MicroStrategy's goal is to raise $42 billion over the next three years to continue buying more Bitcoin.
So far, MicroStrategy's Bitcoin holdings have reached 439,000 coins, accounting for about 2.1% of the total Bitcoin supply (21 million coins), with a total value exceeding $45 billion based on current market value.
According to the company's co-founder and executive chairman Michael Saylor, MicroStrategy's average cost for Bitcoin is approximately $61,725 per coin, with a total cost of about $27.1 billion (including fees and related expenses).
Spending $17.5 billion on Bitcoin in 6 weeks! Market views are polarized.
This marks the sixth consecutive week that MicroStrategy has announced significant Bitcoin purchases. Just last week, the company bought 21,550 Bitcoins for about $2.1 billion, at an average price of $98,783 each; the week before, MicroStrategy also spent $1.5 billion to increase its Bitcoin holdings.
In other words, over the past 6 weeks, MicroStrategy has purchased a total of $17.5 billion in Bitcoin, accounting for about 39% of the current $45 billion holding value.
However, such an aggressive strategy has sparked polarized views in the market. Although MicroStrategy's market value has soared to $92 billion, with its stock price exceeding the estimated net asset value (NAV) of its Bitcoin holdings, many investors remain cautious about the company's reliance on equity and bond financing to continue acquiring Bitcoin.
However, analysts from research firm Bernstein believe that MicroStrategy's Bitcoin strategy still has room to advance.
They noted that as MicroStrategy acquires more Bitcoin, the premium on market valuations will gradually rationalize, and given the company's current leverage ratio (convertible bonds accounting for 18% of Bitcoin net worth), there is still room for expansion, meaning the company can still issue more convertible bonds to raise funds. Analysts emphasize:
If the price of Bitcoin continues to consolidate around $100,000, MicroStrategy should be able to maintain this pace of accumulation.
Officially joining the 'Nasdaq 100 Index'
It's worth noting that MicroStrategy will officially join the 'Nasdaq 100 Index' on December 23, becoming the 40th largest company in the index, accounting for about 0.47%.
This also means that popular exchange-traded funds (ETFs) like QQQ will simultaneously buy MicroStrategy shares. Bloomberg analyst James Seyffart estimates this will bring at least $2.1 billion in capital inflow.
Bernstein analysts believe that being included in the 'Nasdaq 100 Index' will further enhance MicroStrategy's market value and market liquidity, creating a 'capital flywheel effect' that allows the company to continue selling shares and buying Bitcoin.
For those who are skeptical about Bitcoin, this may sound like a nightmare, but MicroStrategy's strategy is to continually buy Bitcoin and hold it long-term until Bitcoin surpasses gold, or even breaks through $1 million.
Looking ahead, the market is more concerned about whether MicroStrategy is likely to join the 'S&P 500 Index' in 2025.
Although the company's core software business profitability has not yet met expectations, the newly implemented FASB cryptocurrency accounting rules will allow the company to account for unrealized Bitcoin investment gains and losses in its financial reports, which may become a key boost for MicroStrategy's entry into the S&P 500.
The first 'cryptocurrency accounting rules' in the United States have officially taken effect! MicroStrategy and Tesla will benefit.
"Spent $17.5 billion on Bitcoin in 6 weeks! MicroStrategy spends another $1.5 billion to increase its purchases" This article was first published on (Block Customer).
