MicroStrategy makes record bitcoin purchase for $4.6 billion

Investing.com - MicroStrategy Incorporated (NASDAQ:MSTR) added 52,000 bitcoins to its portfolio worth $4.6 billion over the last week, marking the largest purchase in the company's history, software firm disclosed in a regulatory filing on Monday.

MicroStrategy's shares surged 9%, reaching $371, with the stock having quintupled in value so far this year.

Bitcoin has been rallying since Donald Trump’s election as U.S. president driven by expectations of regulatory easing, and breached the $90,000 level last week to an all-time high.

The latest purchase took place between November 11 and November 17, 2024, for 51,780 at a price of about $88,627 per bitcoin. This has boosted its total holdings of the world's biggest cryptocurrency to over 331,000 bitcoins, worth $16.5 billion.

To fund the acquisition, MicroStrategy raised $4.6 billion in net proceeds through the sale of 13.6 million shares under a sales agreement finalized in October 2024, the company disclosed in a filing to SEC.  

The agreement allows the company to issue shares worth up to $21 billion through a group of financial agents, including TD Securities, Barclays (LON:BARC), and others.

As of mid-November, MicroStrategy's total bitcoin holdings have been acquired at an average price of $49,874 per bitcoin—substantially lower than the recent purchase price.

Since 2020, MicroStrategy has been acquiring and holding bitcoin as a strategic move, especially as revenue from its software business slowed. It is now the largest corporate holder of the cryptocurrency.

A Bernstein note published Monday suggested that Bitcoin could reach $100,000 imminently, with a target value of $200,000 by 2025.