MicroStrategy May Soon Hold Upwards of 0.4% of All Bitcoin

Bitcoin Price

  • The cryptocurrency space was rocked with the news last week that MicroStrategy would be purchasing an additional stash of Bitcoin.
  • The firm will be purchasing $650 million worth of BTC.
  • This means, according to data compiled by Messari, that the firm may soon own upwards of 0.4% of all Bitcoin circulating.

MicroStrategy Confirms Impending Purchase of BTC

The Bitcoin space was rocked with news last week that MicroStrategy would be purchasing an additional stash of Bitcoin. The firm, a business services and analytics company based in the U.S., has purchased $450 million worth of BTC over the past few months to hedge its treasury. The company held a large sum of cash that it decided to invest in the cryptocurrency due to the unprecedented macro conditions.

While some thought that the move was foolish, it has paid off for MicroStrategy quite handsomely. The company stock is up over 100% since its first Bitcoin purchase. And, it appears that there is a demand for further BTC investment.

The firm revealed last week that it had raised $650 million in the sale of debt (senior convertible notes) to qualified institutional buyers. With that capital, less fees, MicroStrategy will be purchasing Bitcoin.

“MicroStrategy estimates that the net proceeds from the sale of the notes will be approximately $634.9 million, after deducting the initial purchaser’s discounts and commissions and estimated offering expenses payable by MicroStrategy. MicroStrategy intends to invest the net proceeds from the sale of the notes in bitcoin in accordance with its Treasury Reserve Policy pending identification of working capital needs and other general corporate purposes.”

More Than 0.4% of the Circulating Bitcoin Supply May Soon Be Owned by MicroStrategy

Analysis compiled by analysts at Messari found that after this purchase, the firm may own somewhere around or more than 0.4% of all circulating Bitcoin.

Ryan Watkins, a researcher at the firm, wrote on the matter:

“The above doesn’t even include MSTR’s just completed $650mm convertible note raise whose proceeds will be used to buy BTC. This will take MSTR’s total BTC holdings well over $1 billion. Depending on the price it pays, MSTR could end up owning 0.4% of the circulating BTC supply.”

While a large amount of BTC, the Winklevoss Twins alone are expected to hold more than 0.4% of the circulating supply. Others, including billionaire venture investor Chamath Palihapitiya, are also expected to own large portions of the cryptocurrency’s circulating supply.

Many think that the MicroStrategy allocation to BTC will force other firms to allocate capital to the space to keep up with the times.

Case in point: MassMutual, a large American life insurance company, recently put $100 million into Bitcoin to gain exposure to the growing financial technology space.

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MicroStrategy May Soon Hold Upwards of 0.4% of All Bitcoin

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