MicroStrategy is Considering Issuing Billions of Shares to Buy Bitcoin

The company's plan to buy the first cryptocurrency is moving much faster than originally anticipated.

The world's largest corporate holder of Bitcoin, MicroStrategy, plans to issue billions of new shares to raise funds to invest in the cryptocurrency, according to documents filed with the US Securities and Exchange Commission (SEC). The decision will be made through a shareholder vote.

MicroStrategy shareholders will consider a proposal to issue an additional 10 billion shares to raise money to buy even more Bitcoin. A meeting and a shareholder vote will be held in 2025.

If approved, the company would increase its Class A common stock from 330 million to 10.33 billion and its preferred stock from 5 million to 1.005 billion.

This is part of a three-year fundraising programme by MicroStrategy called 'Plan 21/21'. The company plans to raise $42 billion to buy Bitcoin: $21 billion through a public offering and another $21 billion through common and convertible bonds.

"The proposals we are asking you to consider reflect the next chapter in our evolution as a bitcoin depository and our ambitious goals for the future," Michael Saylor wrote in a letter to shareholders.

MicroStrategy Evaluates Issuance of Billions of Shares to Expand Holdings in Bitcoin

MicroStrategy, a leading business intelligence firm and a major institutional investor in Bitcoin, is reportedly considering issuing billions of dollars in equity to fund further Bitcoin acquisitions. The company has consistently demonstrated its reliance on Bitcoin as a long-term store of value, frequently using its balance sheet and debt instruments to expand its holdings.

This move aligns with MicroStrategy's strategy of integrating Bitcoin into its corporate treasury, underscoring the company's belief in the potential for substantial cryptocurrency appreciation in the coming years.

Following Donald Trump's victory in the US presidential election, i.e. within a month and a half, MicroStrategy reported the purchase of 192,042 bitcoins for a total of $17.69 billion (about 40% of the $42 billion under the '21/21 Plan'). The company owns more than 2% of the total supply of BTC.

According to the latest data as of 22 December, MicroStrategy has 444,262 BTC on its balance sheet, on which it has spent $27.7 billion at an average purchase price of $62,257 per 1 BTC. At the current rate ($94,000), its cryptocurrency reserves are estimated at $41.7 billion.