A never-before-seen buying spree – MicroStrategy and its CEO Michael Saylor have become totally bulimic on bitcoin, they can’t get enough. After announcing a $400 million bond raise to buy more BTC, the company has been inundated with offers from lenders very interested in (indirect) exposure to the king of cryptos.
Hedge fund demand 4 times higher than initial supply
Publicly traded company MicroStrategy continues its mad dash for bitcoin by launching a third bond issue fundraiser in six months.
After $550 million in December 2020, and then $1 billion in February 2021, CEO Michael Saylor just revealed that the company will issue $500 million in additional debt.
Indeed, as Bitcoin Magazine reports, while the initial announcement was for $400 million, demand from institutional investors was so great – especially hedge funds – that MicroStrategy decided to issue an additional $100 million in bonds.
In total, various investors were even willing to put a total of $1.6 billion into MicroStrategy’s bonds, which is 4 times more than what was originally planned. It must be said that in addition to gaining exposure to Bitcoin, these whales will benefit from a 6.125% rate from MicroStrategy, with all of its BTC as collateral in case of non-repayment.
Given that Michael Saylor’s company was sitting on 92,079 BTC around mid-May, MicroStrategy is therefore well on its way to surpassing 100,000 bitcoins in its treasury very soon. Will the strategy of taking on debt in US dollars to accumulate more and more bitcoins be a winning one? MicroStrategy seems more than convinced.
