BTC
Speculation has been mounting that MicroStrategy (MSTR) may have stopped buying Bitcoin *BTCUSD in January due to a common lock-up period on issuing convertible equity or debt.
A lock-up period for publicly traded companies is a temporary time frame during which certain activities related to the company's securities are restricted. These restrictions are usually self-imposed.
MicroStrategy's Bitcoin Buying May Slow Down in Q1 2025
A prominent venture capitalist has claimed that CEO Michael Saylor faces restrictions in January that could prevent the issuance of new convertible debt to fund further Bitcoin acquisitions.
However, this may disappoint many MSTR investors who have been closely following the company's aggressive Bitcoin buying strategy.
"Saylor has a lockout period throughout January and can't issue any new debt to buy BTC. The lunatic goes for it until Dec 31st, then altcoin season," Vance Spencer wrote on X (formerly Twitter).
Some observers have suggested that the common ban may arise from insider trading regulations. While the SEC does not prohibit trading by insiders after the end of the fiscal quarter, many companies adopt blackout periods to avoid the appearance of any wrongdoing.
These periods typically last from two weeks to a month and typically end a few days after quarterly earnings announcements. Others have speculated that the restrictions may apply only to "at-the-market" (ATM) stock sales, not to convertible debt issues.
Another analyst wrote on X: “I think the MSTR lockout periods are overstated in terms of duration and expected impact. I am not convinced that MicroStrategy will stop buying Bitcoin or stop ATMs for the period from the close of the quarter to the release of the quarterly report (~40 days). I understand that the regular 8K filings and press releases meet all fair disclosure requirements, and they have established a standard for doing so in their market activity thus far.”
Another theory links the potential ban to MicroStrategy's inclusion in the Nasdaq 100 on December 23, suggesting that internal committee recommendations may have led to the halt.
MicroStrategy's next earnings report is expected between February 3 and 5, 2025. Analysts believe any lock-up period could extend throughout January or start mid-month on January 14.
“So far in the quarter, MSTR’s treasury operations have delivered a BTC return of 46.4%, a net benefit of ~116,940 BTC. At $105K per BTC, that equates to ~$12.28B for the quarter,” Michael Saylor wrote on X.
MicroStrategy currently holds $46.02 billion worth of Bitcoin, sitting on an unrealized gain of over $18.9 billion. The company bought over $3 billion worth of BTC in December alone, at prices above $100,000. This shows how bullish Michael Saylor is on the largest cryptocurrency. Bitcoin’s bull run this year has been reflected in MicroStrategy’s stock market performance. MSTR’s stock price is up over 460% year-to-date.
The increase has propelled the company into the top 100 publicly traded companies in the United States. The stock was recently added to the popular Nasdaq-100 and is likely in contention to join the S&P 500 next year.
