MicroStrategy Plans $2.8B Stock Sale to Buy 25K More Bitcoin: A Bold Bet or Risky Move?
Introduction
MicroStrategy, the world’s largest corporate holder of Bitcoin (BTC), has once again doubled down on its crypto strategy by quadrupling its latest preferred stock offering from $500 million to $2.8 billion. The proceeds will be used to purchase an additional 25,000 BTC, further cementing its position as a dominant player in institutional Bitcoin adoption.
This aggressive fundraising move comes amid growing scrutiny over the company’s $8 billion debt load, with critics warning of potential risks if Bitcoin’s price faces prolonged downturns. However, supporters argue that MicroStrategy’s long-term conviction in BTC as a treasury reserve asset justifies its bold approach.
In this article, we break down MicroStrategy’s latest capital-raising strategy, analyze its growing Bitcoin holdings, and assess the potential risks and rewards of its high-stakes bet on cryptocurrency.
MicroStrategy’s Latest Capital Raise: A 4x Increase in Preferred Stock Offering
MicroStrategy initially planned a $500 million preferred stock sale under its Stretch (STRC) offering but has now expanded it to $2.8 billion due to strong institutional demand. Major financial players like Morgan Stanley and Barclays have reportedly shown interest, signaling confidence in the company’s Bitcoin-focused business model.
This is not MicroStrategy’s first foray into raising capital via stock offerings. The company has previously issued:
- Stride (STRD)
- Stark (STRK)
- Strife (STRF)
- Its primary common stock, MSTR
Michael Saylor, MicroStrategy’s founder, refers to these financial instruments as the “Bitcoin defense department,” highlighting their role in securing more BTC for the company’s treasury.
Historical Context: How MicroStrategy Funds Its Bitcoin Purchases
Since August 2020, MicroStrategy has employed a mix of stock sales, convertible bonds, and debt issuance to accumulate Bitcoin. Key milestones include:
- 2020: First BTC purchase of 21,454 BTC ($250M)
- 2021: Multiple bond offerings totaling billions to buy more BTC
- 2024–2025: Expansion of preferred stock offerings (STRC, STRD, STRK)
As of July 2025, MicroStrategy holds 607,770 BTC (~$70 billion at current prices), making it the largest corporate Bitcoin holder globally.
The Debt Dilemma: Is MicroStrategy Overleveraged?
While MicroStrategy’s Bitcoin strategy has been lucrative during bull markets, concerns persist over its growing debt burden. As of March 2025:
- Total debt: $8 billion+
- Debt maturing by mid-2028: $3.65 billion
Critics argue that excessive leverage could backfire if Bitcoin enters a prolonged bear market, forcing liquidations or equity dilution. Jake Chervinsky, Chief Legal Officer at Variant Fund, cautioned:
“The last thing crypto needs is a bunch of bad risk managers blowing up and getting liquidated in the traditional equity markets.”
However, Galaxy Research’s Alex Thorn believes these fears are currently overblown but could become critical by 2028, when the first major debt tranche matures.
Comparing Risk vs. Reward
MicroStrategy’s approach mirrors that of early-stage tech companies that took on significant debt to fuel growth—except instead of investing in R&D or acquisitions, it is buying Bitcoin. If BTC continues appreciating long-term, the strategy could pay off handsomely. However, a severe downturn could strain the company’s financial stability.
Market Reaction: MSTR Stock and Bitcoin Price Correlation
MicroStrategy’s stock (MSTR) is often seen as a leveraged proxy for Bitcoin’s price movements. Recent trends show:
- MSTR peaked at $457.22 before dropping 12% to $405 (as of press time).
- The decline followed Bitcoin’s pullback from all-time highs to around $115K.
- Despite short-term volatility, MSTR remains up 72% from April 2025 lows.
This correlation underscores how closely tied MicroStrategy’s valuation is to Bitcoin’s performance—a double-edged sword for investors.
What Happens Next? Key Factors to Watch
- Bitcoin Price Trends: A sustained rally could validate MicroStrategy’s aggressive accumulation strategy, while a downturn may amplify debt concerns.
- Debt Management: How the company handles its $3.65 billion debt maturing by 2028 will be crucial.
- Institutional Interest: Continued demand for MSTR stock offerings suggests Wall Street remains bullish on Bitcoin as a corporate asset.
- Regulatory Landscape: Any major crypto regulatory shifts could impact MicroStrategy's ability to raise capital via stock sales or bonds.
Conclusion: A High-Stakes Bet on Bitcoin’s Future
MicroStrategy’s decision to raise $2.8 billion for additional Bitcoin purchases reinforces its unwavering commitment to BTC as a treasury reserve asset. While critics warn about debt risks, proponents argue that the company is positioning itself as a long-term leader in institutional crypto adoption.
For investors and crypto enthusiasts, MicroStrategy serves as a case study in corporate Bitcoin strategy—one that balances aggressive accumulation with financial leverage. The next few years will determine whether this bold approach pays off or exposes vulnerabilities in an increasingly volatile market.
Final Thought:
As MicroStrategy continues doubling down on Bitcoin, the broader question remains: Will other corporations follow suit, or will caution prevail? Only time—and market cycles—will tell.