MicroStrategy, the software company turned Bitcoin investment vehicle, has acquired an additional 5,262 Bitcoin tokens worth $561 million, according to a SEC filing on Monday. The purchase comes as the company prepares to join the prestigious Nasdaq 100 Index. The latest acquisition was made between December 16-22 at an average price of $106,662 per Bitcoin, marking the company's seventh consecutive week of purchases. The timing coincided with Bitcoin reaching a new all-time high above $108,000 during the purchase period.
Under the leadership of Chairman Michael Saylor, MicroStrategy has outlined ambitious plans to raise $42 billion over the next three years through stock sales and convertible debt offerings to fund additional Bitcoin acquisitions. The company has already exceeded its capital targets set for 2025.
The recent purchase demonstrates MicroStrategy's unwavering commitment to its Bitcoin strategy, despite price volatility. Last week, Bitcoin's value dropped to $92,149 following the Federal Reserve's rate decision, causing MicroStrategy's shares to decline by 11%.
TD Cowen analyst Lance Vitanza, who maintains a "buy" rating on the stock, noted that MicroStrategy's ability to raise funds has surpassed initial expectations. "We haven't even gotten to 2025 yet, and they're two-thirds of the way through," he said.
The company's success in raising capital has been partly driven by hedge funds engaging in convertible arbitrage strategies - purchasing bonds while short-selling shares to capitalize on stock volatility.
However, analysts caution that MicroStrategy's business model heavily depends on Bitcoin's continued appreciation at rates exceeding alternative investments. A prolonged downturn in Bitcoin prices could pose risks to the company's strategy.
With this latest acquisition, MicroStrategy has strengthened its position as the largest corporate holder of Bitcoin, now holding 439,000 BTC valued at over $41 billion.