Michael Saylor’s MicroStrategy has announced that one of its subsidiaries has taken out a loan of $205 million with which to buy more bitcoin.
With bitcoin getting close enough to have a very real chance of closing in on a price of $50,000, possibly by the end of this week, MicroStrategy is getting ready to pull the trigger yet again, and add more bitcoin to its already substantial haul.
According to an article on Forbes earlier today, the loan will be over the term of 3 years, and will be collateralised with 12% of MicroStrategy’s existing bitcoin holdings, which amounts to around $820 million in value.
Michael Saylor, the CEO of MicroStrategy, and well-known bitcoin bull, stated that the loan would allow MicroStrategy to “further its position” as the public company with the largest bitcoin holding, and he also said that using bitcoin as collateral for the loan was a first for the firm, and that it would enable it to continue to acquire more.
MicroStrategy made the first of its several acquisitions of bitcoin back in August of 2020. Since that time, the haul has grown to more than 125,000 bitcoins, costing the company nearly $3.8 billion, and purchased at an average of $30,200 per bitcoin.
Rise of the crypto market
The announcement of the purchase comes at a time when the crypto market is seeing quite a resurgence. Bitcoin has risen just over $10,000 in a little more than 2 weeks, bringing most of the crypto sector along for the ride.
Over a similar timeframe ethereum has managed a 39% rise, taking it from around $2,500, to reach $3,480, where it is hovering at time of writing.
Other major cryptocurrencies have had even more spectacular runs. Cardano, one of the layer one cryptocurrencies to be hit the hardest in this year’s downturn, recorded a 60% surge, however, with indicators starting to signal that it is in overbought territory, profits may well start to be taken.
Luna may not be the star of the show over the last couple of weeks, with a fairly modest 30% in comparison. However, taking its ascent since its local bottom of $43 on February 17, it has been the market leader overall, rocketing 148%, to claim a recent all-time-high of $107.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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