MicroStrategy’s [MSTR] Plan to Issue 10B Shares Leaves Market Watchers Divided

MicroStrategy [MSTR] plans to issue 10 billion new shares to raise $10 billion in capital, a move that could help the company continue its aggressive Bitcoin [BTC] buying strategy.

As of December 2024, MSTR had already acquired 444,262 BTC, valued at $41.8 billion. The company's heavy involvement in Bitcoin has made its stock a proxy for the cryptocurrency, with MSTR's fortunes closely tied to BTC's price movements.

According to a recent SEC filing, MSTR stated that it planned to use the proceeds from the share offering "for general corporate purposes, which may include the acquisition of additional Bitcoin."

The company also highlighted its "urgent need" for additional capital to continue its Bitcoin-related activities, as its current capital resources were expected to be fully depleted by 2025.

MSTR's strategy carries significant risks, as a downturn in Bitcoin's price could impact the company's ability to service its growing debt. Critics have also pointed out that MSTR may be forced to sell off its Bitcoin holdings to raise capital if the cryptocurrency experiences a sustained decline.

However, MSTR's status as a key player in the crypto market gives its actions a strong influence on Bitcoin's price. The company's latest move is likely to keep investors closely watching the Bitcoin market in the coming months.