MicroStrategy’s Bitcoin Treasury Hits $63.46B; Preferred Equity Yield Draws Skeptics
MicroStrategy’s Bitcoin holdings hit a record $63.46 billion on April 26, holding 815,061 BTC at an average cost of $75,528 per coin and realizing $1.9 billion in unrealized gains. The company funded its April purchase of 34,164 BTC for $2.54 billion using $2.18 billion in 11.5% preferred equity and $366 million in share sales.
1. Record Bitcoin Treasury
On April 26 MicroStrategy’s Bitcoin holdings reached $63.46 billion, holding 815,061 BTC at an average cost of $75,528 per coin. The treasury gained nearly $2 billion over the past week, making it the largest publicly disclosed corporate Bitcoin stake.
2. Funding Through Preferred Equity
April’s acquisition of 34,164 BTC for $2.54 billion was the largest single-week purchase in 17 months. MicroStrategy financed this via $2.18 billion of 11.5% perpetual preferred equity and $366 million of at-the-market common share sales.
3. Dividend Model Concerns
Peter Schiff warns that the 11.5% variable dividend on preferred equity demands continuous capital issuance or Bitcoin sales to fund payouts. He cautions that a reduction in demand for preferred shares could force asset sales, pressuring both Bitcoin prices and the company’s net asset value.