MicroStrategy Funds Next Bitcoin Investment Through Massive Bond Sales
The software manufacturer is underlining its belief in Bitcoin with bond sales totaling US $ 650 million.
Major software company MicroStrategy (MSTR) announced on Friday that it had generated $ 650 million from bond sales to further invest in Bitcoin ( BTC )
Accordingly , on Friday, MicroStrategy disclosed that it had sold $ 650 million in its own corporate bonds, which have an interest rate of 0.75% with a term until 2025. The interest payments are due every six months, with these being settled on June 15 and December 15.
In the associated press release, the software manufacturer confirms that the funds raised are to be invested in the market-leading cryptocurrency:
“MicroStrategy intends to invest the net proceeds from bond sales in Bitcoin System, provided the capital generated is not needed for other corporate purposes.”
The sales came just days after the company first announced that it would sell bonds to invest in Bitcoin. As previously reported by Cointelegraph , MicroStrategy originally intended to raise “only” 400 million US dollars. With 650 million US dollars, the software manufacturer could buy more than 36,300 BTC at the current price.
MicroStrategy caused a stir this year when the company made public that it had invested large parts of its assets in Bitcoin. In the run-up to the investment , CEO Michael Saylor said at the time that his company was “sitting on a $ 500 million melting iceberg” that had to be saved.
MicroStrategy currently owns 40,824 BTC, which is currently equivalent to more than $ 734 million. Just by switching to Bitcoin , the company made just under $ 260 million in profit
However, some Wall Street analysts warn that MicroStrategy may now be too heavily invested in Bitcoin. Until recently, the volatility of the cryptocurrency was the main reason for many institutional investors to distance themselves from it. Citibank recently downgraded MicroStrategy shares because, in their opinion, the company is “disproportionately” reliant on Bitcoin.
MicroStrategy is probably the largest Bitcoin investor among the companies, but it is far from the only one. After listed companies such as Galaxy Digital (GLXY), Square (SQ) and Hut 8 Mining Corp (Hut-8) each invested between 36 million and 134 million US dollars in Bitcoin, the American insurance company MassMutual is for its part this week entered the market-leading cryptocurrency with 100 million US dollars .