Strategy, previously known as MicroStrategy, has just announced that it raised $427 million in one week by selling corporate shares through ATM offerings to buy 4,020 additional Bitcoins. Now, MicroStrategy holds 580,250 BTC.
MicroStrategy uses an approach known as "at-the-market" (ATM) offerings to sell company stock directly to investors. MSTR is their common stock, while STRK and STRF are preferred stock that pay annual interest at 8% and 10%, respectively.
This approach allows MicroStrategy to raise cash by selling shares without taking on traditional debt, using the funds to purchase Bitcoin, which they view as a better long-term investment than cash.
MicroStrategy issued its first preferred stock, STRK, in early 2025, which began trading on the Nasdaq on February 1, 2025. Following this, the company issued another preferred stock, STRF, priced on March 20, 2025.
The company has been criticized for concentrating its risk on Bitcoin. Michael Saylor, the company’s leading figure, has borrowed extensively to acquire Bitcoin. If Bitcoin drops below a specific price point, the company may face challenges with loan repayment depending on debt agreements.
Critics also highlight the controversy of the company being entirely invested in Bitcoin rather than diversifying. Peter Schiff stated that if Bitcoin were to crash, MicroStrategy could face significant financial losses. However, Saylor maintains that lenders cannot force a quick sale of Bitcoin, even in a downturn, and they won't panic-sell irrespective of Bitcoin's price.
At press time, Bitcoin is trading at $109,797.03, according to Kraken's price feed via Yahoo.
This article has been published on thestreet.com via Yahoo News.
