Ready to buy more BTC! MicroStrategy expands stock issuance, how to make BTC and shareholders win-win.

Expand the share capital issuance, prepare to raise funds to buy more BTC

Renowned business intelligence software company MicroStrategy recently submitted a proposal to the U.S. Securities and Exchange Commission (SEC) for a special shareholders' meeting, planning to significantly increase the number of ordinary and preferred shares that the company can issuance in order to raise funds to acquire more BTC. According to the official filing, MicroStrategy will increase the number of Class A common stock from the original 330 million shares to 10.33 billion shares, and the preferred stock from 5 million shares to over 1 billion shares, reserving greater space for future stock or bond issuance.

Source: StreetInsider MicroStrategy Submits Special Shareholder Meeting Proposal to SEC

This proposal is seen as the implementation basis of MicroStrategy's '21/21 Plan'. The plan was announced in October, with an expected fundraising of $21 billion in equity capital and $21 billion in fixed income product capital over the next three years, totaling $42 billion, to purchase BTC. MicroStrategy emphasizes in official documents that increasing the number of issuable shares is not only for this plan, but also for the company's broader future capital deployment. With MicroStrategy frequently raising funds to buy coins through issuance and debt issuance in the past few years, the market expects that if the proposal is approved, the company will further consolidate its position as the 'first stock of BTC'.

Realizing shareholder value: BTC strategy renews its brilliance

MicroStrategy founder and BTC strategy director Michael Saylor also publicly declared his "shareholder benefit theory" on social media. He revealed that the company's finance department generated approximately 0.72% return with BTC recently, equivalent to about 3,177 BTC, calculated at the recent BTC price of approximately $94,000, resulting in a profit of about $299 million. Saylor referred to it as a "Christmas gift to the company's shareholders".

Source: Michael Saylor said the success of his BTC strategy is a "Christmas gift" to shareholders.

During the '21/21 plan', MicroStrategy frequently increased its holdings of BTC. In December alone, it acquired 42,000 BTC at a cost of about 4 billion USD. According to Saylor Tracker data, MicroStrategy and its subsidiaries collectively hold 444,262 BTC, with a total cost of approximately 27.7 billion USD and an average purchase price of 62,226 USD per BTC. Despite a brief pullback in BTC due to the hawkish tone of the Federal Reserve recently, the company's stock price has still more than quadrupled since the beginning of the year due to the rise in BTC, bringing considerable returns to investors.

Image source: Saylor Tracker MicroStrategy's BTC holdings overview

Intensive issuance of bonds and equity expansion, expanding positions on both fronts

Not only "BTC revenue", MicroStrategy has also been raising funds in the market, successfully raising $13 billion in equity funds and $3 billion in bond funds through the issuance of stocks and convertible bonds within two months. Most of these funds are used to execute the company's BTC purchase plan, resulting in a rapid increase in its holdings. With the recently submitted proposal for additional issuance at the shareholders' meeting, it is evident that MicroStrategy is attempting to pave the way for significant expansion of investments in the future.

Regarding this 'extreme' BTC deployment strategy, Saylor has repeatedly stated that he believes BTC has long-term appreciation potential and can become the best corporate treasury reserve. The company also emphasizes that holding BTC not only provides higher returns for shareholders, but also creates stable cash flow through various financial instruments (such as derivative financial products or income-generating structures). The new announcement also indicates that its BTC annual return target is expected to reach 6% to 10% from 2025 to 2027.

"BTC first stock" continues to lead, and the heat of the cryptocurrency industry continues to burn.

Overall, MicroStrategy's 'stocks + bonds + BTC' integrated strategy demonstrates the company's ongoing deepening layout in the cryptocurrency industry: on the one hand, it consolidates financial flexibility through professional financial operations and issuance proposals; on the other hand, it injects more BTC exposure to attract investors to share profits. For shareholders who are bullish on the long-term value of BTC, MicroStrategy's decisiveness is undoubtedly a major advantage.

However, this strategy also faces potential risks: BTC is highly volatile, and once the market situation reverses, MicroStrategy may face financial pressure due to the rapid decline in asset net worth. In addition, after expanding its capacity, the company's financial leverage has also increased, and it needs to guard against the risk of capital turnover. Nevertheless, MicroStrategy continues to move forward boldly, providing a remarkable model for whether other enterprises can emulate.

In the future, whether MicroStrategy will have another larger-scale BTC purchase action will be a focus of the market, depending on whether the proposal is passed at the special shareholders' meeting. If successfully implemented, its holding amount and enterprise market value performance will undoubtedly have a profound impact on the confidence and trend of the cryptocurrency industry once again.

Further Reading MicroStrategy buys BTC for 1.75 billion pounds! Economists criticize: it's just a Ponzi scheme Concept stocks related to Bitcoin listed on the Nasdaq 100! MicroStrategy creates history again, is Bitcoin gaining mainstream financial recognition? Faith should change! MicroStrategy: the United States should sell gold to buy BTC, implying further large-scale purchases

【Disclaimer】There are risks in the market, and investment needs to be cautious. This article does not constitute investment advice. Users should consider whether any opinions, views, or conclusions in this article are suitable for their specific situation. Investment based on this is at your own risk.

'Prepare to buy more BTC! MicroStrategy expands its share issuance, how to make BTC and shareholders win-win.' This article was first published in 'Crypto City'.