MicroStrategy, a company focused on Bitcoin development, has revealed its ambitious plan to raise $42 billion in capital over the next three years to buy more Bitcoin. Led by Executive Chairman Michael Saylor, the company’s “21/21 Plan” involves $21 billion in equity raises and $21 billion in debt offerings.
In a recent earnings press release, President and CEO Phong Le stated, “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.” This announcement comes after MicroStrategy’s last disclosed purchase of 7,420 bitcoins in mid-September for $458.2 million, bringing their total holdings to 252,220 bitcoins acquired for $9.9 billion.
With the current price of Bitcoin at around $72,000, the company’s Bitcoin holdings are now valued at over $18 billion. MicroStrategy also announced an increase in the target range of its “BTC Yield” to 6%-10% from the previous 4%-8%. The BTC Yield, a key performance indicator created by Saylor and his team, measures how effectively the company acquires Bitcoin in a way that benefits shareholders. In Q3, the BTC Yield was reported at 17.8%.
Despite this news, MicroStrategy’s shares saw a 10% decline in after-hours trading, although they remain significantly higher by about 250% year-to-date. The company still has $891.3 million in reserved capital from a previous fundraising effort.
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MicroStrategy’s bold plan to acquire more Bitcoin over the next three years demonstrates their confidence in the long-term potential of the cryptocurrency. With a strategic focus on increasing their Bitcoin holdings and achieving higher BTC Yield, the company aims to leverage its capital resources to further solidify its position in the digital asset market. As the cryptocurrency landscape continues to evolve, MicroStrategy’s proactive approach may set a precedent for other companies looking to diversify their treasury assets.
