- MicroStrategy filed to sell At Market Stocks with the SEC
- The firm intends to use some of the funds to buy more Bitcoin
- Also, MicroStrategy just completed a $500M bond offering to buy Bitcoin
MicroStrategy just filed paperwork with the Securities and Exchange Commission (SEC) to offer Class A stocks through an Open Market Sale Agreement. Notably, the agreement will enable the firm to buy more Bitcoin (BTC).
— Michael Saylor (@michael_saylor) June 14, 2021
According to the filing the firm stated,
We intend to use the net proceeds from the sale of any class A common stock offered under this prospectus for general corporate purposes, including the acquisition of bitcoin.
Presently, the firm holds about 92,079 BTC and will soon be acquiring more. The new acquisition is thanks to a recently completed $500 million offering of $6.125% senior secured bonds. The bonds are due in 2028 and MicroStrategy will use the proceeds to buy more Bitcoin.
The cloud software company previously revealed that its bond offering was oversubscribed. It is thus no surprise that the company looks ready to buy about $1 billion worth of Bitcoin.
MicroStrategy CEO Michael Saylor is extremely bullish on BTC despite the crypto’s recent volatility. However, the firm is not unaware of the risks associated with holding the majority of its treasury in crypto. In fact, MicroStrategy added an acknowledgment of the same in its SEC filing.
MicroStrategy added, “The concentration of our bitcoin holdings enhances the risks inherent in our bitcoin acquisition strategy. Servicing our debt will require a significant amount of cash, and we may not have sufficient cash flow from our business to pay our indebtedness”
At this point even die BTC fans are skeptical of MicroStrategy’s BTC strategy. Crypto analyst Lark Davis called the strategy either genius or crazy. Nonetheless, only time will tell.