MicroStrategy Seeks Shareholder Approval to Expand Bitcoin 21/21 Plan

MicroStrategy Calls Special Shareholders’ Meeting to Expand Bitcoin Investments

MicroStrategy, a software company known for its aggressive Bitcoin acquisition strategy, has called a special shareholders’ meeting to gain approval for expanding its equity issuance plan. The move is part of the company’s ambitious “21/21 Plan,” aimed at purchasing an additional $42 billion worth of Bitcoin over the next three years.

Proposals to Expand Share Issuance

According to a December 23 filing with the U.S. Securities and Exchange Commission (SEC), MicroStrategy seeks shareholder approval for two key amendments to its capital structure:

1. Class A Common Stock
   • Increase the authorized shares from 330 million to 10.33 billion.
2. Preferred Stock
   • Expand authorized shares from 5 million to over 1 billion.

These changes would provide MicroStrategy with greater flexibility to issue equity and fund its Bitcoin purchases under the 21/21 Plan.

The 21/21 Plan: Accelerated Bitcoin Acquisitions

Disclosed in October 2024, the 21/21 Plan outlines MicroStrategy’s roadmap for purchasing $42 billion worth of Bitcoin by 2027.

• Funding Sources
  • $21 billion raised through equity sales.
  • $21 billion raised through fixed-income securities.
• Progress
  • In December alone, the company purchased 42,162 BTC worth over $4 billion at current prices.
  • To date, MicroStrategy has raised $13 billion through stock issuances and $3 billion via convertible bond offerings.
• Current Holdings
  • As of December 22, MicroStrategy and its subsidiaries owned 444,262 BTC, valued at approximately $43.5 billion.
  • The total acquisition cost was $27.7 billion, averaging $62,257 per BTC.

Performance and Yield

MicroStrategy’s Bitcoin strategy has significantly boosted its financial performance:

1. Yield Performance
   • Reported BTC yield of 17.8% at the end of October 2024.
   • Targets an annual yield of 6% to 10% between 2025 and 2027.
2. Stock Market Performance
   • MicroStrategy’s stock on the Nasdaq has surged 422% year-to-date, largely driven by its Bitcoin-focused strategy.

Shareholders’ Meeting and Future Outlook

The date for the special shareholders’ meeting has not yet been announced. However, the company’s next earnings report is scheduled for February 2, 2025, offering a closer look at its progress on the 21/21 Plan.

MicroStrategy’s leadership highlighted the rapid pace of execution, stating:
“We have been executing on our 21/21 Plan significantly faster than originally anticipated.”

Implications of the 21/21 Plan

1. Market Impact
   • MicroStrategy’s aggressive Bitcoin purchases have the potential to influence market dynamics, especially given its growing stake in the cryptocurrency.
2. Investor Confidence
   • The company’s strategy has attracted institutional and retail investors, as evidenced by the significant stock price increase.
3. Long-Term Vision
   • By expanding its Bitcoin holdings and leveraging equity and fixed-income instruments, MicroStrategy aims to solidify its position as a major player in the digital asset ecosystem.

MicroStrategy’s 21/21 Plan underscores its commitment to Bitcoin as a core component of its corporate strategy. By seeking shareholder approval to expand its capital structure, the company aims to accelerate its acquisitions and capitalize on the cryptocurrency’s growth potential. With billions already invested and more on the horizon, MicroStrategy continues to set a bold precedent for corporate Bitcoin adoption.