MicroStrategy Buys Another $1.3 Billion in Bitcoin, Total Holdings Exceed 568,000 BTC

Strategy, a prominent player in corporate cryptocurrency adoption, continues its assertive approach to asset accumulation. The company’s substantial Bitcoin treasury underscores a growing trend among businesses seeking exposure to digital assets, positioning Strategy as a key entity in this evolving financial landscape.

Significant Bitcoin Acquisition

Between May 5th and May 11th, Strategy significantly increased its Bitcoin holdings, purchasing an additional 13,390 BTC. This acquisition involved an outlay of approximately $1.3 billion, with the coins bought at an average price of $99,856 each. This information was disclosed in an 8-K filing with the Securities and Exchange Commission (SEC).

This latest purchase brings Strategy’s total Bitcoin reserves to a remarkable 568,840 units. At current market rates, this stash is valued at over $59 billion. Impressively, the company’s aggregate acquisition cost, including fees and expenses, stands at $39.4 billion. This translates to an average cost of $69,287 per Bitcoin. With these holdings, Strategy now controls approximately 2.7% of the maximum possible Bitcoin supply of 21 million coins. Notably, over 300,000 BTC have been added to their treasury within the last six months alone.

Funding and Strategic Outlook

The financing for this substantial purchase was secured through the issuance of company stock. Strategy sold Class A (MSTR) shares raising $1.31 billion and perpetual preferred shares (STRK) generating $25.1 million. The company maintains the capacity for further fundraising under its existing program.

This activity aligns with Strategy’s ambitious “42/42” plan. The objective is to raise $84 billion by 2027 through stock and convertible bond offerings, specifically to fund further Bitcoin acquisitions. This represents an expansion of their original, now largely completed, “21/21” initiative. Executive Chairman Michael Saylor hinted at ongoing activity, recently sharing an update to his purchase tracker with the message, “Connect the dots,” suggesting the accumulation strategy remains firmly in place.

Corporate Treasury Trend

Strategy’s aggressive accumulation has set a precedent in the corporate world. Its pioneering approach has influenced numerous other companies to allocate capital towards Bitcoin for their treasuries. Firms like Cantor Fitzgerald, SoftBank, Bitfinex, and Tether (which announced a $3.6 billion fund named Twenty One) have followed suit. Other notable entrants include Semler Scientific, Metaplanet, and KULR.

Financial Health and Market Perception

Despite reporting a net loss of $4.2 billion in the first quarter, primarily due to nearly $6 billion in unrealized losses under new fair value accounting standards, Strategy’s financial position appears stable. The company maintains manageable debt levels with no significant maturities looming before 2028.

The market values Strategy significantly higher than the raw value of its Bitcoin holdings. Its market capitalization stands at $113.7 billion, reflecting a substantial premium – nearly double the net asset value of its Bitcoin. Investor confidence seems intact, as the company has successfully raised over $15 billion through “at-the-market” offerings without significant negative impact.

Strategy’s Class A (MSTR) shares have shown positive momentum, reflecting investor interest in the company’s Bitcoin-centric strategy. Analyst firms like Benchmark and Bernstein maintain positive outlooks, reaffirming buy ratings with respective price targets of $650 and $600 for MSTR stock.