MicroStrategy Settles Silvergate Loans, Increases Bitcoin Portfolio: A Deep Dive into the Company’s Crypto Strategy – MicroStrategy (NASDAQ:MSTR)
Software company Micro strategy MSTR has repaid the outstanding principal on its $205 million loan from the now defunct Silvergate Bank SAYwhich specializes in cryptocurrency services, according to a recent US Securities and Exchange Commission filing.
The company, co-founded by cryptocurrency advocate Michael Saylor, has a significant amount Bitcoin BTC/USD and disclosed the acquisition of an additional 6,455 Bitcoins, worth approximately $150 million (around $23,238 per coin), over the past five weeks.
The repayment of the loan of 161 million dollars took place last Friday.
Upon settlement of the loan, 34,619 bitcoins used as collateral were returned to MicroStrategy’s possession. The company had secured the loan in March 2022.
The newly acquired 6,455 Bitcoins bring MicroStrategy’s total holdings to 138,955 Bitcoins, purchased at an average price of $29,817 each and valued at nearly $3.88 billion based on the current Bitcoin price of $27,900.
MicroStrategy also disclosed that it raised $339.4 million this year through stock sales and used the funds to repay the Silvergate loan.
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Last month, MicroStrategy reported a net loss of $249.7 million for Q4 2022, compared with a loss of $90 million in the same period a year earlier.
The company has gained more recognition in recent times due to its significant investment in Bitcoin.
MicroStrategy announced the sale of about $340 million in stock as part of an earlier stock sale agreement.
The proceeds generated, combined with a portion of the company’s cash holdings, were used to settle the Silvergate loan.
While MicroStrategy’s core business focuses on software, its significant investments in Bitcoin have brought the company to the forefront of the cryptocurrency industry.
As a result, the firm has become a significant player in the digital asset space, consistently expanding its Bitcoin holdings and maintaining a strong presence in the market.
Despite the reported losses, MicroStrategy remains steadfast in its commitment to Bitcoin, continuing to invest in cryptocurrency as a strategic asset.
The repayment of the Silvergate loan and the acquisition of additional Bitcoin underline the company’s confidence in the long-term potential of digital currencies.
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