MicroStrategy’s determined push to buy more Bitcoin is showing no signs of slowing down.
Hours after closing the sale of senior secured notes worth $500 million so it can increase its exposure to cryptocurrency, the business intelligence firm filed with the U.S. Securities and Exchange Commission — revealing it plans to sell $1 billion in common shares.
Investors can sometimes take a dim view of such practices because it effectively waters down the value of their stock. That said, MicroStrategy’s stock did deliver an impressive surge of 16% on Monday, meaning it closed the session at $598.
Concerns have been raised over MicroStrategy’s tactics, amid fears that the company could be left insolvent if the price of Bitcoin falls below a key level. Right now, the business is sitting on paper profits worth $1.4 billion.
Words of Wisdom
The senior secured notes sold by MicroStrategy will be due in 2028 and will pay an annual interest rate of 6.125%.
In a slew of bullish tweets on Tuesday morning, the company’s CEO Michael Saylor asked his followers: “Do you expect the price of #Bitcoin to appreciate more than 6.125% annually over the next seven years?”
More than 10,000 votes had been cast at the time of writing — with 88.9% saying that they expect Bitcoin to exceed this interest rate.
Saylor went on to add:
“It's better to have a #Bitcoin and not need it than need a Bitcoin and not have it.”