Saylor Files with SEC for $1B Microstrategy Stock Offering

MicroStrategy, the computer-software company led by the bullish Bitcoin maxi (BTC) Michael Saylor, revealed this week filings with the SEC for a stock offering of $1 Billion.

The documents filed avoid providing details specifying how the capital raise will be used. However, in a recent interview Saylor said that the filing will allow for equity to be issued in the future so that MicroStrategy can purchase more BTC and retire debt, alongside other corporate purposes.

This equity financing move is a continuation of the capital raises orchestrated by Saylor. Forming part of a BTC acquisition strategy which last week saw MicroStrategy announce a senior secured debt through the launch of the world’s first BTC Bond.

Saylor later revealed this BTC Bond capital raise exceeded its initial goal of $400m, with $500m raised in total.

https://twitter.com/michael_saylor/status/1404760761109524486

These moves see MicroStrategy continue trading at a premium to its BTC holdings, with Saylor insisting his shareholders maintain support despite the dilution.

MicroStrategy’s Bitcoin accumulation strategy is based on Saylor’s belief that BTC is digital gold, arguing that it’s an attractive inflation hedge for institutional finance – outperforming gold by a factor of 50.

This comes following reports of the Consumer Price Index reaching 5% for the first time since 2008. This could forecast a greater institutional move towards BTC in efforts to hedge inflation and measures emerging from this week’s FOMC meeting.

The trading premium of MicroStrategy is seen as a flag by some bearish analysts; a signal of overvaluation. The BTC accumulation strategy exposes MicroStrategy to huge risk of insolvency if the price of BTC turns heavily bearish.

Saylor argues that the premium is bullish and justified by the company’s ability to raise capital and debt with zero-interest as well as large-scale purchases of BTC. MicroStrategy remain active in the enterprise software space and this allows them to raise large debts. However, with this week’s market in flux all eyes are on Saylor in MicroStrategy’s scramble to reach 100,000 BTC.

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