MicroStrategy may be preparing to buy more bitcoins, as much as $1 billion worth. The Cloud software company filed paperwork with the Securities and Exchange Commission (SEC) for proposed public sale of class A common shares through Open Market Sale Agreement. This type of open-ended agreement allows the firm to sell stock “from time-to-time” depending on its needs.
The filing reads to sell $1 billion worth of its stock for ‘general purpose’, which may include buying more Bitcoin. The firm said that it will sell its shares in a shelf offering. It will allow a company to issue securities to the public multiple times over a period, based on market conditions. Microstrategy is one of the world’s biggest hodlers. With this offering, it is easy to speculate that MicroStrategy may buy more Bitcoins.
“We intend to use the net proceeds from the sale of any class A common stock offered under this prospectus for general corporate purposes, including the acquisition of bitcoin,” the firm wrote in a filing.
Microstrategy currently holds more than 92,000 BTC on its balance sheet, worth roughly $3.7 billion. It sold $500 million in corporate debt last week so that it could increase the total.
The risky strategy has caught the firm some flak. However, the “forward looking statements” section of SEC filing shows it is well aware of it.
“The concentration of our bitcoin holding enhances the risks inherent in our bitcoin acquisition strategy. Servicing our debt will require a significant amount of cash, and we may not have sufficient cash flow from our business to pay our indebtedness.”
