MicroStrategy plans to raise $400 million to buy more bitcoin
MicroStrategysaid on Tuesday it plans to offer $400 million worth of convertible bonds to raise funds to purchase more bitcoin.
- Proceeds from the private offering will be invested in the
cryptocurrency"pending the identification of working capital needs," the company said.
- As of December 4, MicroStrategy holds a total of 40,284 bitcoins.
- CEO Michael Saylor is keen on expanding investment into the digital token because he sees government stimulus measures inflating US money supply rapidly.
US software firm MicroStrategy plans to raise $400 million through convertible bonds to buy more bitcoin, the company announced Tuesday.
Proceeds from the debt sale will be invested in bitcoin if they aren't required for general corporate needs, the statement said.
The business-intelligence group first purchased $250 million worth of bitcoin in August, calling it a "reasonable hedge against inflation." At the time, its investment equated to 21,454 bitcoin.
MicroStrategy bought another $50 million of the crypto asset on December 4 at an average price of $19,427 per bitcoin. It now holds about 40,284 bitcoins, according to a filing with the Securities and Exchange Commission.
MicroStrategy's stock has doubled since the start of November, and is up around 121% year-to-date.
CEO Michael Saylor explained to CoinDesk that his venture into bitcoin emerged from the realization that the company's $500 million cash pile was shrinking as an effect of federal stimulus measures eroding the value of dollars.
"What we're trying to do is preserve our treasury," he said. "The purchasing power of the cash is debasing rapidly."
Bitcoin has had a historic ride this year as the pandemic continues to fan fears of inflation, hitting an all-time high of $19,857 last week. The token was trading lower around $18,753 on Tuesday.
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