Michael Saylor, co-founder and chairman of MicroStrategy Inc., has outlined plans to enhance “intelligent leverage” for the company’s shareholders.
The Virginia-based firm, which has transformed from a software maker to a leveraged Bitcoin investment vehicle, continues to draw significant attention for its bold cryptocurrency strategy.
MicroStrategy’s Intelligent Leverage: What Does Michael Saylor Mean?
In a recent interview with Bloomberg Television, Saylor shared the company’s approach to optimizing its capital structure.
He said;
“We have $7.2 billion in convertible bonds, with $4 billion effectively acting as equity through the strike price and call price.”
“These convertibles are trading with a delta of nearly 100%, resembling equity. Our goal is to build more intelligent leverage to benefit our common stock shareholders.”
MicroStrategy has become one of the most closely watched corporate players in cryptocurrency.
This year, the company accelerated its unconventional approach, raising $42 billion solely to purchase and hold Bitcoin.
As a result, its stock has soared by around 500%, significantly outpacing Bitcoin’s roughly 150% gain over the same period.
Over the past six weeks, the firm has announced multi-billion-dollar Bitcoin acquisitions every Monday, fueling a surge in its share price alongside the cryptocurrency’s rising value.
However, this aggressive strategy has also sparked debates about its long-term sustainability and risks.
MicroStrategy’s issuance of convertible bonds has been key to its capital-raising efforts. This year alone, the company issued $6.2 billion worth of convertibles, attracting interest from hedge funds employing convertible arbitrage strategies.
These funds purchase the bonds while shorting the company’s stock, which means betting on its volatility.
The heightened demand for its fixed-income securities has bolstered MicroStrategy’s ability to continue leveraging its position.
Despite questions surrounding the viability of its approach, MicroStrategy’s market capitalization has soared to over $90 billion.
This growth has led to the company’s inclusion in the Nasdaq 100 Index, a major milestone expected to drive additional institutional interest.
According to Bloomberg Intelligence, funds that track the tech benchmark index may purchase over $2 billion worth of MicroStrategy shares following its inclusion at the end of trading on Friday.
MicroStrategy’s Market Cap Nears $100 Billion Amid Bitcoin’s Unprecedented Rally
Bitcoin has surged 120% this year, recently surpassing $100,000, and has climbed nearly 40% in the past month.
MicroStrategy has been a key beneficiary. Since 2020, the company has acquired 386,700 BTC for $21.9 billion, now worth approximately $37.6 billion.
In 2024 alone, MicroStrategy added 249,850 BTC, bringing its total holdings to 439,000 BTC—surpassing Marathon Digital’s 40,435 BTC by 985%.
MicroStrategy’s market cap is nearing $100 billion, positioning it among major U.S. companies if Bitcoin’s price continues to rise.
Saylor recently shared the company’s performance, noting a 46.4% yield quarter-to-date and a 72.4% year-to-date return. On December 9, the firm announced an additional purchase of 21,550 BTC.
On December 1, Saylor presented Bitcoin to Microsoft’s board and urged the tech giant to embrace the cryptocurrency.
He proposed an annual $100 billion Bitcoin investment, arguing that it could add nearly $5 trillion to Microsoft’s market capitalization. However, the majority downvoted the proposal in the last annual shareholder meeting.
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