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Michael Saylor Announces Plans to Raise $21 billion from Stock Sale

  • Michael Saylor announced plans to raise funds to buy Bitcoin by issuing and selling $21 billion worth of MicroStrategy shares.
  • The equity raise is part of a larger plan to raise $42 billion for Bitcoin purchases over the next three years.
  • The at-the-market equity offering will dilute current shares by 42% of their capitalisation, which currently stands at $50 billion.

Michael Saylor, co-founder and Chairman of MicroStrategy, announced plans to raise $21 billion to buy more Bitcoin by offering more MSTR shares at prevailing market prices. The amount of shares issued would dilute the value of existing shares held by current shareholders.

Usually, this level of dilution would lead to a significant discount in stock price to retain the same overall value, which is manifest by a fall in stock prices.

However, MicroStrategy’s stock price has not fallen significantly since the announcement, due largely to its cohort of shareholders, the performance of its stock since 202, and its Bitcoin holding.

An overview of MicroStrategy’s Bitcoin purchases

MicroStrategy began buying Bitcoin in 2020, at a time when adding Bitcoin to corporate balance sheets was not as accepted as it is today. Over the last four years, the company has issued corporate debt notes to fund its Bitcoin purchases and currently holds 252,220 Bitcoin (roughly 1% of the total Bitcoins supply) worth roughly $17.6 billion.

The company’s most recent purchase was in September 2024, when it bought 7,420 Bitcoin at an average price of $61,750 per BTC, totalling $458.2 million, which it raised by offering senior debt notes.

Shareholders hope despite dilution concerns

MicroStrategy is in a unique position because the size of its Bitcoin holdings creates a correlation between Bitcoin’s price performance and that of its stock. With each major Bitcoin purchase, MSTR moves closer to being a quasi-Bitcoin spot ETF.

However, the total cost of MicroStrategy’s Bitcoin purchases hovers around $9.9 billion while the current value of the company’s holding is 95% higher than the cost price, a performance that has fueled the company’s stock rally.

MSTR, which traded around $13 in 2020 when MicroStrategy began its Bitcoin buying strategy, is currently trading at $244.50. The share price has grown 250% this year alone, outpacing Bitcoin’s 60% performance.

MicroStrategy’s capital plans and Saylor’s projections

Michel Saylor’s plan to buy $42 billion worth of Bitcoin over the next three years, fueled by a $21 billion equity raise and debt notes, could increase the company’s Bitcoin holdings by threefold, depending on the average buy price.

Saylor expects Bitcoin to reach between $3 million and $49 million in the next 20 years and is therefore building MicroStrategy into a Bitcoin bank.

Bitcoin trades at $70,105 as of publishing after recently testing the all-time highs of $73,000 reached in March 2024.

The post Michael Saylor Announces Plans to Raise $21 billion from Stock Sale appeared first on CoinJournal.

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SingularityDAO community approves merger with SelfKey and Cogito Finance

  • SingularityDAO merges with SelfKey and Cogito to form Singularity Finance.
  • 94.7% of SDAO holders approved the merger, awaiting KEY holders’ final vote.
  • Singularity Finance to focus on AI, RWA tokenization, and on-chain identity.

In a landmark decision, SingularityDAO, the DeFi arm of the SingularityNET AI ecosystem responsible for decentralized portfolio management, has voted to merge with Cogito Finance and SelfKey to form a new entity, Singularity Finance. This EVM Layer 2 platform will focus on tokenizing the AI economy and accelerating the adoption of AI-powered financial solutions.

The merger was approved by an overwhelming 94.7% of SingularityDAO (SDAO) token holders, with over 15 million tokens cast in favour.

The community vote, conducted through the Snapshot governance platform, represents a critical step toward Singularity Finance’s creation, which will offer advanced decentralized finance (DeFi) and artificial intelligence (AI) solutions. Notably, the vote comes barely two weeks after the merger was proposed.

Mario Casiraghi, Co-Founder of SingularityDAO, expressed gratitude for the community’s support, saying, “We’re grateful to all SDAO holders for participating in this pivotal governance vote and having their say on the future of SingularityDAO. With their approval, we will now move ahead with the proposal to create Singularity Finance as an L2 that combines the best elements of SingularityDAO with those of our partners SelfKey and Cogito Finance to accelerate DeFi and AI innovation.”

Cloris Chen, CEO of Cogito Finance, highlighted the partnership’s potential, stating, “The overwhelming community support for the SFI merger is a powerful testament to the shared vision we have for the future of finance. By combining our expertise and technologies, we are poised to unlock unprecedented opportunities at the intersection of AI and DeFi.”

SelfKey Community expected to vote on the merger

The merger now awaits a final vote from SelfKey’s community of KEY token holders to solidify SelfKey’s participation.

Once approved, Singularity Finance will serve as a comprehensive platform addressing critical areas in the AI and DeFi ecosystem, including real-world asset (RWA) tokenization and on-chain identity management.

This integrated approach will enhance SingularityDAO’s existing AI-powered portfolio management capabilities with SelfKey’s compliance features and Cogito Finance’s RWA tokenization solutions.

A leadership council will guide Singularity Finance, with prominent members including Dr. Ben Goertzel, CEO of SingularityNET, Cloris Chen, CEO of Cogito Finance, and Mario Casiraghi, CFO of SingularityNET. Together, they aim to pioneer innovative financial services, targeting developers and users in the emerging AI-based financial landscape.

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