MicroStrategy, a prominent American business intelligence and analytics firm, has announced its intention to purchase Bitcoin once again. The company has increased its initial $500 million offering of convertible notes to $700 million, intending to use the proceeds to buy Bitcoin. This substantial acquisition could potentially drive up the price of Bitcoin due to increased demand amid market volatility.

MicroStrategy Set to Increase Bitcoin Holdings

In a recent press release, MicroStrategy disclosed its plan to sell $700 million in new convertible notes, aiming to use the funds to expand its Bitcoin holdings. These notes will have a 2.25% interest rate and mature in 2032.

The convertible senior notes will be sold privately to qualified institutional investors under Rule 144A of the amended Securities Act of 1933. Additionally, MicroStrategy plans to allow initial purchasers of these notes the option to buy up to an extra $100 million within 13 days from the issuance date.

The company stated that the proceeds from these notes, estimated at $687.8 million after expenses, will be used to purchase more Bitcoin for general corporate purposes. This amount could rise to $786 million if the additional $100 million notes are purchased.

Earlier, on April 29, MicroStrategy reported its first quarter 2024 financial results, revealing total Bitcoin holdings valued at $7.54 billion, with an average purchase price of $35,180 per BTC. As of June 14, 2024, MicroStrategy is the world's largest Bitcoin holder among public companies, with a market capitalization of approximately $26.53 billion.

Currently, Bitcoin is trading at $66,223 (TradingView). Despite significant losses in the past few years, MicroStrategy continues to expand its Bitcoin holdings, now owning about 1% of all Bitcoin in existence.

Bitcoin’s Strong Accumulation Phase Could Trigger New Highs

Bitcoin’s price is currently trending downward, affected by selling pressures from miners who have sold over 1,200 BTC, valued at $79.20 million. As of writing, Bitcoin’s value has dropped to $66,145, a 4.70% decrease over the past seven days (CoinMarketCap).

MicroStrategy’s upcoming $700 million Bitcoin purchase could potentially trigger a price rebound. Additionally, a crypto analyst known as 'Jelle' noted on X (formerly Twitter) that Bitcoin has been in a significant re-accumulation phase over the past three months. Investors have been buying more Bitcoin during its recent price drop, reducing the total balance of Bitcoin on exchanges by 200,000 over this period.