In a bold move to deepen its exposure to bitcoin, Strategy (formerly MicroStrategy) has In an attempt to double down on Bitcoin exposure, Strategy (formerly MicroStrategy) has raised the initial amount of its Series A Perpetual Stretch Preferred Stock offering from $500 million to $2 billion which is in simple terms four times its previous size. The expansion comes on the back of a successful8 sale of bitcoin-linked shares and shows the willingness of Strategy to go deeper into its already hefty crypto treasury.
Stretch Offering Now at $90 with 9% Dividend
The company is authorized to sell the Stretch shares $90 each, reflecting a 10% discount to the $100 face value marketed. These shares come with a 9% cumulative annual dividend, which the company can adjust on a monthly basis. This issuance is the company’s fourth preferred stock program, ranking above the Strike (STRK) and Stride (STRD) stocks but below senior stocks and convertible notes in terms of priority.
Proceeds Aimed at Increasing Bitcoin Holdings
The total proceeds from the upsized offering will be used to purchase more bitcoin, making Strategy the largest corporate holder of BTC and further extending its lead. Only a week ago, the company used $739.9 million of share sale proceeds to buy 6,220 BTC, thereby its bitcoin holdings to 607,770 BTC, representing almost 3% of the total 21 million bitcoin supply.
The value of Strategy’s bitcoin treasury currently exceeds $72 billion, giving it an edge as the dominant player in corporate bitcoin acquisition.
Strategy Eyes 900,000 BTC by 2027
According to TD Cowen, Strategy’s preferred stock tools could help the company scale its holdings to 900,000 BTC by 2027. Analysts argue that, despite frequent issuance, each Stretch share today still controls more bitcoin than it did 18 months ago. Strategy’s ability to borrow at low capital costs while buying the top crypto asset justifies the premium at which its market capitalization trades relative to its net asset value.
Market Cap Hits $124 Billion
Strategy’s common stock is currently trading near $414, giving the firm a market capitalization of $124 billion. Backed by institutions like Morgan Stanley, Barclays, Moelis, and TD Securities as bookrunners, the Stretch program is expected to draw continued5 demand from investors bullish on bitcoin’s long-term prospects.
Conclusion
With this bold move, Strategy not only solidifies its reputation as a corporate bitcoin heavyweight but also leverages innovative financing to accumulate BTC without selling its core assets. As other firms cautiously navigate crypto exposure, Strategy is doubling down — and then some.
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