MicroStrategy plans to buy even more Bitcoin

Publicly listed software company MicroStategy (MSTR) is already the largest Bitcoin holding company, with over 129,000 BTC in its vaults. Now, just a month after its pompous CEO Michael Saylor resigned and a week after the Attorney General of Washington DC sued the company and Saylor for alleged tax evasion, the company wants to buy more.

In a prospectus filed with the SEC on Friday, MicroStrategy said the company has reached an agreement with investment bank Cowen & Co. to sell up to $500 million of Class A common stock.

“We may use the net proceeds from this offering to purchase additional Bitcoins,” the company said in the filing. The firm warned against BitcoinVolatility and wild price swings that saw the largest cryptocurrency by market capitalization trade below $20,000 earlier this week, down from an all-time high of $68,789 in November 2021, according to data from CoinMarketCap.

“Future fluctuations in Bitcoin trading prices may cause Bitcoin purchased with the net proceeds of this cash offer to be converted to be worth significantly less than the net proceeds of this offer,” the company said.

Under Saylor, the enterprise software company has accumulated a significant Bitcoin Cash of 129,699 BTCcurrently worth more than $2.7 billion, which the company says it wants to hold for the long term.

Last month, MicroStrategy reported a non-cash digital impairment charge of $917.8 million in the second quarter of 2022, the same month, Saylor resigned as CEO, transitioning to Executive Chairman.

In the prospectus, MicroStategy added that it does not intend to engage in any transactions or enter into any derivative contracts with its Bitcoin holding, but may sell Bitcoin if necessary to generate cash for ” cash management and other general business purposes”.

“We have not targeted any specific amount of Bitcoin holdings,” the company said. “We will continue to monitor market conditions to determine whether to proceed with debt or equity financing to purchase additional bitcoin.”

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