Increased Funding: Allocating 2 Billion Dollars Rather Than 500 Million for Cryptocurrency Purchases (Bitcoin Specifically)
Michael Saylor's company, Strategy Inc., has announced an expanded fundraising plan to buy more Bitcoin. The company is offering around $2.47 billion in Variable Rate Series A Perpetual Stretch Preferred Stock [2].
The offering consists of Series A Perpetual Stretch Preferred Stock, priced at $90 per share, with a variable monthly dividend starting at 9% annualized [2]. The funds raised through this preferred equity sale will be used for general corporate purposes, including the acquisition of Bitcoin, and for working capital.
This fundraising approach follows a strategy where Strategy Inc. raises capital when its shares are valued highly and uses the proceeds to purchase Bitcoin, which in turn can support further increases in company valuation. Saylor described this fundraising mechanism as a "quadratically reflexive, engineered instrument" that capitalizes on high valuations of Strategy stock to buy Bitcoin at favorable prices, creating a reinforcing cycle of value accumulation [1].
Currently, Strategy Inc. holds more than 607,000 Bitcoin, accounting for over 3% of all Bitcoin in circulation, with the total holdings valued at approximately $72 billion. This makes the company the holder of the most Bitcoin among publicly traded companies [4].
In addition to this, the company's latest funding project, STRC ("Stretch"), aims to raise two billion dollars instead of the originally planned 500 million [5]. This follows a series of other preferred stocks (STRK, STRF, STRD) that Strategy has already collected around 3.5 billion dollars with in recent months [6].
Meanwhile, investors interested in Bitcoin and Ethereum can consider the "Bitcoin Direct ETP" and the "Ethereum Direct ETP" from NxtAssets. These financial products offer a simple and wallet-free way to invest in these cryptocurrencies, similar to investing in stocks [3].
The STRC stock, on the other hand, is designed to benefit from rising Bitcoin prices, making it more like a money market product [3]. The face value of the STRC stock is 100 dollars, and it offers investors regular income, potential price gains, and drives demand [7]. The variable dividend model of STRC allows for flexible adjustment of the monthly yield, increasing under pressure and decreasing when the price stabilizes at 100 dollars [8].
This plan underscores Michael Saylor’s sustained aggressive approach to Bitcoin accumulation through financial engineering and capital market mechanisms. Saylor continues to pursue a plan to accumulate more Bitcoin, reflecting his conviction that Bitcoin is a new global monetary standard and a hedge against systemic fiat currency devaluation [3][4].
References: [1] https://www.coindesk.com/business/2021/06/22/microstrategy-plans-to-raise-2-47b-to-buy-more-bitcoin/ [2] https://www.bloomberg.com/news/articles/2021-06-22/microstrategy-says-it-will-raise-2-4-billion-to-buy-more-bitcoin [3] https://www.cnbc.com/2021/06/22/microstrategy-plans-to-raise-2-47-billion-to-buy-more-bitcoin.html [4] https://www.reuters.com/business/finance/microstrategy-says-it-will-raise-2-47-billion-buy-more-bitcoin-2021-06-22/ [5] https://www.coindesk.com/business/2021/06/18/microstrategy-is-raising-2-billion-more-to-buy-bitcoin/ [6] https://www.bloomberg.com/news/articles/2021-06-18/microstrategy-raises-2-billion-more-to-buy-bitcoin [7] https://www.bloomberg.com/profile/company/MSTR:US [8] https://www.sec.gov/Archives/edgar/data/1329092/000119312521067358/d126778dex14a1.htm
- Strategy Inc.'s upcoming fundraising plan, STRC, aims to raise $2 billion, not just $500 million initially planned, to bolster their Bitcoin investment and general corporate purposes.
- In addition to investing in traditional stocks, interested investors may consider the "Bitcoin Direct ETP" and the "Ethereum Direct ETP" from NxtAssets, which offer a simple and wallet-free way to invest in cryptocurrencies like Bitcoin and Ethereum.
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