MicroStrategy Announces $42 Billion Capital Plan To Buy More Bitcoin
MicroStrategy's "21/21" plan involves an equal split of equity sales and fixed income securities offerings.
MicroStrategy (MSTR) announced on Wednesday that it plans to raise $42 billion over the next 3 years to purchase more BTC for its balance sheet, and improve “BTC yield” for its shareholders.
- In its Q3 earnings release, the company said that the “21/21 Plan” would involve raising $21 billion through ATM equity offerings, and $21 billion in fixed-income securities.
- 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,” said Phong Le, President and Chief Executive Officer of MicroStrategy.
- The company’s new targets for annual BTC yield have risen to between 6% and 10%, achieved by executing such raises and offerings at the right time.
- MicroStrategy also reported a $412 million impairment loss on its digital assets, indicating that it is yet to adopt fair value accounting for its business.
- MicroStrategy executive chairman Michael Saylor announced this month that he plans to evolve MicroStrategy into a trillion-dollar Bitcoin bank. MSTR stock soared to 20-year highs shortly after this promise.
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