MicroStrategy acquires 2,138 BTC, bringing total holdings to 446,400 BTC.
MicroStrategy announced that it purchased 2,138 bitcoins between December 23 and December 29, 2024, for a total transaction amount of $209 million. This acquisition brings its total bitcoin holdings to an astounding 446,400, with a cumulative purchase total of approximately $27.9 billion.
Here are the details announced by the company, its key performance indicators, and the impact of this move on its bitcoin strategy.
Large-scale bitcoin acquisitions funded by stock sale proceeds.
During this week, MicroStrategy successfully utilized its stock sale proceeds to acquire bitcoins through the execution of a stock sale agreement signed in October 2024. According to this agreement, MicroStrategy can issue and sell its Class A common stock, raising a net proceeds of $209 million. This fund was used to purchase bitcoins at an average price of $97,837 each (including related costs).
This strategy aligns with MicroStrategy's long-standing practice of expanding bitcoin reserves through equity capital. As of December 29, 2024, the company still holds approximately $6.88 billion in stock available for future issuance under this sale agreement.
MicroStrategy's bitcoin holdings reach an all-time high.
Currently, MicroStrategy's bitcoin holdings have reached a historic high of 446,400 bitcoins. This is a significant increase compared to 189,150 bitcoins at the end of 2023. The average purchase price of its total bitcoin holdings is $62,428, reflecting the company's discipline in accumulating bitcoin over the long term.
MicroStrategy's fourth quarter and annual BTC return performance is strong.
One of the standout indicators in this report is MicroStrategy's BTC Yield, which is an important performance metric used by the company to measure the gains from its bitcoin acquisition strategy. In the fourth quarter of 2024 (quarter-to-date, QTD), the reported BTC yield reached 47.8%; while the yield for the year-to-date (YTD) is as high as 74.1%.
The calculation of BTC yield is based on the percentage change over time of the company's bitcoin holdings relative to the diluted assumed number of shares outstanding. This metric is crucial for assessing how effectively the company utilizes equity capital to create value for shareholders through bitcoin purchases.
Stock issuance strategy supports bitcoin acquisitions.
MicroStrategy's stock issuance strategy provides important funding support for its bitcoin acquisitions. In December 2024 alone, the company raised $209 million by selling 592,987 shares through its at-the-market equity offering program. After a 10-for-1 stock split earlier this year, MicroStrategy currently has approximately 245,459 shares of common stock outstanding.
Additionally, the company has optimized its capital structure by issuing convertible bonds and other instruments, further enhancing BTC returns.
An in-depth analysis of MicroStrategy's BTC return as an indicator.
BTC yield is not a traditional financial metric but a performance metric specifically designed by MicroStrategy to assess its bitcoin strategy. While this metric reveals the efficiency of the company in utilizing equity capital for bitcoin purchases, it also has limitations. For example, BTC yield does not account for the company's debt or other liabilities and assumes that convertible bonds will be fully converted into equity.
Furthermore, BTC yield does not reflect the company's operational performance or liquidity, focusing solely on the efficiency of equity appreciation.
Strategic implications for MicroStrategy.
MicroStrategy's unwavering increase in bitcoin holdings has positioned the company as a leader in the cryptocurrency space. Its strategy of purchasing bitcoins using equity capital reflects a strong belief in the long-term value of this asset. With a reserve of 446,400 bitcoins, MicroStrategy has established itself as a pioneer in bitcoin adoption among publicly listed companies.
However, this strategy is not without risks. The company's heavy reliance on bitcoin exposes it to significant risks from cryptocurrency market volatility. Additionally, BTC returns as an indicator may not be accepted by all investors, as it does not directly measure operational or financial performance.
This article reports that MicroStrategy bought 2,138 bitcoins! MicroStrategy's fourth quarter and annual BTC investment returns performed remarkably well, first appearing in Chain News ABMedia.
