MicroStrategy now owns over 1% of Bitcoin’s total supply

Michael Saylor’s MicroStrategy bought an additional 9,245 Bitcoins throughout this week for $623 million. 

The latest purchase brings their total Bitcoin holdings to 214,246, averaging a purchase price of $35,160 per Bitcoin and cumulatively spending $7.5 billion. MicroStrategy‘s significant investment places the company’s Bitcoin assets at over 1% of the entire Bitcoin market, marking an unrealized profit margin of approximately $6 billion.

The funding for this substantial acquisition came from two sources: $592.3 million was secured through the company’s latest convertible debt offering, and the remaining $30.7 million was allocated from surplus cash reserves.

However, following the announcement of this strategic move and the completion of a $603.7 million convertible debt offering, MicroStrategy’s stock value experienced a 13% decline on Tuesday. The drop occurred in tandem with a decrease in Bitcoin’s value. The deal follows closely with another convertible debt offering of $800 million completed just the week prior.

The company indicated that it plans to pay back its borrowed money in a unique way before September 15, 2030. MicroStrategy plans to do this by allowing investors to swap the cash it lent for MicroStrategy’s shares, but there are specific rules about when and how this can happen.

Initially, for every $1,000 lent to the company, investors receive 0.43 of a MicroStrategy share. This means that if an organization lent them $1,000, the lender could choose to receive shares worth roughly $2,327.21 instead of receiving money back in cash under certain conditions.