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, with a total transaction amount of $209 million. This acquisition brings its total bitcoin holdings to an astounding 446,400 bitcoins, with a cumulative purchase total of approximately $27.9 billion.
Below are the detailed announcements from 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 used the proceeds from its stock sale agreement signed in October 2024 to acquire bitcoins. According to the 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 expenses).
This strategy aligns with MicroStrategy's long-standing practice of expanding its 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 have reached a historic 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 bitcoins over the long term.
MicroStrategy's fourth quarter and annual BTC yield performance is strong.
One of the standout metrics in this report is MicroStrategy's BTC yield, which is an important performance indicator used to measure the effectiveness of its bitcoin acquisition strategy. In the fourth quarter of 2024 (quarter-to-date, QTD), the company reported a BTC yield of 47.8%; while the yield year-to-date (YTD) is as high as 74.1%.
The calculation of BTC yield is based on the percentage change in the company's bitcoin holdings relative to the diluted assumed number of shares in circulation during the period. This indicator is significant for evaluating how effectively the company uses 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 at the beginning of the year, MicroStrategy currently has approximately 245,459 shares of basic common stock.
Additionally, the company has optimized its capital structure through instruments like issuing convertible bonds, further enhancing BTC yield.
An in-depth analysis of MicroStrategy's BTC yield as an indicator.
BTC yield is not a traditional financial metric, but a performance indicator specifically designed by MicroStrategy to assess its bitcoin strategy. While this indicator reveals the company's efficiency in using 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 all convertible bonds will be converted to equity.
Additionally, BTC yield does not reflect the company's operational performance or liquidity, but focuses solely on the efficiency of equity appreciation.
Strategic implications for MicroStrategy.
MicroStrategy's unwavering commitment to increasing its bitcoin holdings has established the company as a dominant player in the cryptocurrency space. Its strategy of using equity capital to purchase bitcoins reflects a strong belief in the long-term value of this asset. With reserves of 446,400 bitcoins, MicroStrategy has set a pioneering image for bitcoin adoption among publicly listed companies.
However, this strategy is not without risks. The company's high dependence on bitcoin exposes it to significant risks from cryptocurrency market volatility. Furthermore, BTC yield 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 has purchased 2,138 bitcoins! MicroStrategy's fourth quarter and annual BTC investment yield performance is impressive, first appeared in Chain News ABMedia.
