- MicroStrategy announces plan to raise $42 billion to bolster its BTC holdings over the next three years.
- The firm hires banks to secure the massive funding for expanded Bitcoin investments.
- The company’s increased Bitcoin investment sparks anticipations of a potential BTC rally.
MicroStrategy announced plans to increase its Bitcoin holdings by raising yet another $42 billion over the next three years. According to a Bloomberg report, the self-proclaimed Bitcoin development company has hired banks to secure massive funding for expanded Bitcoin investments.
In a press release, MicroStrategy outlined its plans to purchase more Bitcoins in the upcoming years. The $42 billion in funding will be split equally between equity ($21 billion) and fixed-income securities ($21 billion), allowing the company to further solidify its position as a Bitcoin Treasury Company.
Bitcoin Buying Spree Could Boost BTC Price
MicroStrategy identifies itself as a Bitcoin Treasury Company and plans to utilize a portion of the funding to expand Bitcoin reserves and maximize returns. The company currently holds 252,220 BTC, valued at around $6.85 billion. Representing 1.2% of the cryptocurrency’s total supply, MicroStrategy ranks as the fifth largest holder of Bitcoin, behind Satoshi Nakamoto, Binance, Blackrock, and Grayscale. The firm’s increased investment in Bitcoin could trigger a significant BTC surge.
As of press time, Bitcoin is trading at $72,311, down 0.20% over the last 24 hours. However, the crypto has climbed 7.3% and 13.4% over the last week and month, respectively.
MicroStrategy Engages Banks for Fundraising
The company has reportedly hired multiple banks to facilitate a dual-track fundraising strategy. This involves an at-the-marketing offering to sell stock to generate $21 billion and sales of fixed-income securities for an additional $21 billion. Sean McNulty, director of trading at liquidity provider Arbelos Markets, commented:
We see the $42 billion as ambitious but not unattainable. Ultimately, if Bitcoin goes higher, it’ll work out for them.
In addition, MicroStrategy has set ambitious targets for annual Bitcoin yields, ranging from 6% to 10%, to be achieved through strategic fundraising and investment timing. Meanwhile, the company reported a $412 million impairment loss on its digital assets, a result of its continued use of historical cost accounting rather than fair value accounting.
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