Bitcoin
MicroStrategy’s purchase of Bitcoin for $786 million causes share value to rise 3%
Microstrategy bought almost 12,000 Bitcoin for $786 million, according to a June 20 report archiving with the US Securities and Exchange Commission (SEC).
Following the news, the company’s shares rose 3% in premarket trading to $1,507, according to Google Finance. data.
Buying bitcoins
The filing stated:
“MicroStrategy acquired approximately 11,931 bitcoins for approximately $786.0 million in cash using proceeds from the Offering and Excess Cash (defined in our quarterly report on Form 10-Q for the three months ended March 31, 2024), at an average price of approximately $65,883. per bitcoin, including fees and expenses.”
With this latest acquisition, the company’s Bitcoin holdings have increased to 226,631 BTC. They were purchased at a total purchase cost of around $8.3 billion, averaging around $36,798 per BTC. Based on current prices of $65,990, the current market value of these holdings is over $15 billion.
Notably, the company recently completed an $800 million debt offering with a 2.25% coupon and 35% conversion premium. Since the beginning of the year, this strategy has helped the company raise more than $2 billion for Bitcoin purchases.
However, despite issuing more shares, which typically dilutes the share value, CryptoSlate Insight reported that the value of Bitcoin per share of the company increased. This increase means that each share now represents more Bitcoin value, benefiting shareholders.
by MicroStrategy Bitcoin holdings per share increased to 0.013163 BTC, with 17,194,000 outstanding shares and a total of 226,331 BTC held.
MicroStrategy Earnings Per Share
BTC to $1 million
Meanwhile, Bernstein analysts have significantly increased their Bitcoin price projections, predicting that the leading digital asset will reach $1 million by 2033 and $200,000 by the end of 2025.
This optimistic outlook is based on the growing demand and limited supply of major cryptocurrencies. Analysts pointed out that recently launched Bitcoin spot ETFs and several institutions have started to incorporate BTC into their treasuries.
They also noted that the digital asset could receive approvals at major communications agencies and large private banking platforms before the end of the year, which would lead to institutional-based trading strategies that would further bolster its adoption.