Financing the Latest Bitcoin Acquisition: Strategy’s Approach

Billionaire Michael Saylor Purchases 10,624 BTC – Is the Bull Market on the Horizon?

Billionaire Michael Saylor Adds 10,624 BTC in Latest Purchase – Is the Bull Market Back?

Michael Saylor’s strategy has acquired another significant amount of Bitcoin as market sentiment appears to be shifting back toward bullish trends.

Key Takeaways:

Saylor's strategy acquired 10,624 BTC for $962.7 million, increasing total holdings to 660,624 BTC.
This purchase was financed by raising $963 million through ATM sales of STRD and MSTR shares.
A cash reserve of $1.44 billion has been established to reassure investors and maintain dividend stability amid market fluctuations.

In a recent post on X, Michael Saylor announced that his strategy had purchased 10,624 BTC for approximately $962.7 million, resulting in an average purchase price of $90,615 per Bitcoin.

With this acquisition, the company now holds a substantial total of 660,624 BTC, which have been bought for an overall amount of $49.35 billion, averaging $74,696 per Bitcoin, as indicated by Strategy's Form 8-K filing with the US Securities and Exchange Commission (SEC).

According to the SEC filing, the latest Bitcoin acquisition was financed through an ongoing at-the-market (ATM) equity offering program. This involved selling 442,536 shares of STRD preferred stock and 5.13 million shares of MSTR common stock from December 1–7, which resulted in net proceeds of $963 million.

The document confirms that the entire BTC purchased during this timeframe was funded directly from the proceeds from these ATM sales, a strategy that has become a core part of the company’s operational plan.

Last week, Strategy's CEO Phong Le noted that the company's newly established cash reserve of $1.44 billion aims to alleviate investor concerns regarding its capacity to handle a significant downturn in Bitcoin's price.

Le spoke about the company's proactive measures, stating, “We’re very much a part of the crypto ecosystem and Bitcoin ecosystem, which is why we chose to raise capital and increase our cash reserves to combat this fear, uncertainty, and doubt (FUD).”

This cash reserve, created through the stock sale, is intended to ensure at least 12 months of dividend payments, with ambitions to extend that coverage to 24 months.

Concerns about the stability of Strategy’s dividends have surfaced recently as Bitcoin’s price saw a decline from its previous peaks.

Le also mentioned that the strategy would only consider selling Bitcoin if the company's stock were to fall below its net asset value, limiting their ability to raise additional funds.

Additionally, Strategy has launched a new “BTC Credit” dashboard, indicating that the company possesses sufficient assets to manage dividend payments for over 70 years.

Bitcoin’s Potential Breakout Amidst Speculated Federal Reserve Actions

Reportedly, Bitcoin's recent surge above $92,000 has reignited enthusiasm among traders, who believe that the upcoming Federal Reserve meeting could be pivotal for the market's next upward movement.

Analysts from the London Crypto Club suggest that a new wave of liquidity from the Federal Reserve might serve as a momentous catalyst, particularly after the market experienced two months of correction that almost wiped out its gains for the year.

In their latest report, analysts David Brickell and Chris Mills expressed expectations of a “dovish surprise,” positing that the Fed may employ a creative bond-buying strategy while continuing its rate-cutting cycle.

They argue that expanding the Fed's balance sheet to “monetise the deficit” could provide significant macroeconomic support for Bitcoin as we enter the new year, especially as traders seek signals that will restore their confidence.