MicroStrategy, the company that owns the largest amount of Bitcoin in the world, has just announced a plan to issue $1.75 billion in convertible bonds to continue purchasing more Bitcoin and serve other corporate purposes. This type of bond has no interest rate, will mature in 2029, and will only be sold to qualified institutional investors. The company expects to be able to purchase approximately 19,000 $BTC if this capital is successfully raised.
On Monday, #microstrategy purchased an additional $4.6 billion worth of Bitcoin, bringing its total holdings to 331,200 BTC, equivalent to about $30 billion at current prices. The company currently owns 1.58% of the total maximum supply of Bitcoin at an average price of $49,874/BTC.
These bonds will be convertible into cash, MicroStrategy stock, or a combination of both. The company also stated that initial investors may have the option to purchase an additional $250 million in bonds within the first three days.
MicroStrategy's strong Bitcoin strategy has attracted significant attention from Wall Street. Major institutions like Vanguard Group and Capital International Investors have increased their holdings in the company to 15.9 and 15.8 million shares. Morgan Stanley also purchased 8.8 million shares, an increase of 1,126% compared to the previous quarter.
Currently, MicroStrategy's stock (MSTR) has increased by 485% this year, far exceeding Bitcoin's increase of 112%. However, #mstr has significantly higher volatility, at 32% compared to Bitcoin's 16%. With the stock closing at $384 on Monday, the company has a market capitalization of up to $78 billion.
MicroStrategy continues to assert its position as the 'largest Bitcoin treasury in the world.' Last October, the company revealed its '21/21' plan, intending to raise $42 billion over the next three years to invest in Bitcoin, split evenly between stocks and bonds.
The company will present more details about this bond issuance in a seminar on Tuesday, but it is only for qualified institutional investors.
