Business Intelligence company MicroStrategy is looking to raise $42 billion over the next three years to purchase additional Bitcoin.
Background
- Dubbed the 21/21 plan, the firm intends to raise $21 billion in equity and another $21 billion via fixed-income securities offerings
- With BTC trading at $72.5k, $42 billion worth of the asset would translate to ~579k coins
- In hindsight, that’d be 2.7% of the asset’s total supply
Why should you pay attention?
- Via the company’s treasury strategy, MicroStrategy increased its BTC holdings by 11% in Q3
- In retrospect, its YTD BTC yield notched to 17.8%
- Andrew Kang, the firm's Chief Financial Officer brought to light that this initiative reduced MSTR's total annualized interest expense by $24 million
- The firm plans to achieve an annual BTC yield of 6% to 10% between 2025 and 2027
Who said what?
- Phong Le, the company’s President and CEO affirmed,
“Our focus remains to increase value generated to our shareholders by leveraging the digital transformation of capital”
- He added,
"As a Bitcoin Treasury Company, we plan to use the additional capital to buy more Bitcoin as a treasury reserve asset in a manner that will allow us to achieve higher BTC Yield”
Zooming out
- Before this, the firm announced the purchase of 7,420 BTC in mid-September
- At the time, its holdings rose to 252,220 BTC, acquired for $9.9 billion at an average price of $39,266 apiece
- At the current market price, the firm’s stash is worth more than $18 billion
