MicroStrategy shareholders approved issuing billions of new shares to fund more Bitcoin purchases, boosting its holdings to 461,000 BTC. While the strategy has driven a 704% stock surge over the past year, critics warn of shareholder dilution and increased volatility.
MicroStrategy owners have agreed to a plan to create billions of new shares to raise money for buying more Bitcoin. The result, which received 56% of the votes, supports Michael Saylor’s bold 21/21 plan for the company.
On Monday, MicroStrategy revealed that it bought $1.1 billion in Bitcoin, raising its total to 461,000 BTC, which is worth $50 billion. The company wants to increase its number of shares from 300 million to 10.3 billion.
Turbocharged Growth
MicroStrategy’s strong Bitcoin plan has greatly increased its stock price in the past year, with shares rising by 704%. The company is now part of the Nasdaq 100 index. But its shares have dropped 20% since reaching their highest point in November.
Critics say that issuing more shares will reduce the value for current owners and make the company’s value more unstable, as it will be more closely linked to Bitcoin’s price. Charlie Morris, the founder of ByteTree, warned that new investors might have difficulties because of this strategy.
In October, Saylor announced a plan to raise $42 billion, half from stocks and half from bonds, to purchase more Bitcoin. MicroStrategy has changed its focus to becoming a Bitcoin banking company, which has encouraged other businesses to do the same.
As of now, 77 public companies own Bitcoin, up from 30 in 2021, according to Bitcoin Treasuries.
