Nikolas Sargeant
Michael Saylor's MicroStrategy has dramatically expanded its preferred stock offering from $500 million to $2 billion, capitalizing on surging institutional demand for Bitcoin exposure through traditional securities. The quadrupled raise demonstrates the growing appetite for cryptocurrency investments packaged within familiar financial structures.
The expanded offering revolves around MicroStrategy's newly launched "Stretch" (STRC) preferred shares, initially conceived as 5 million shares priced at $100 each. According to Bloomberg sources, the shares will now price at $90 per share, slightly below face value to accommodate the significantly enlarged offering size.
Series A Perpetual Stretch preferred shares carry an attractive 9% initial dividend rate, with pricing scheduled for Thursday afternoon in New York trading sessions. The discount pricing strategy has successfully attracted overwhelming investor interest, prompting management to quadruple the original fundraising target.
The Stretch securities maintain a specific hierarchy within MicroStrategy's capital structure, ranking senior to existing Strike and Stride preferred stock classes while remaining subordinate to Strife securities and convertible bonds. This careful structuring provides investors with defined risk-return profiles across the company's various funding instruments.
Stretch shares offer unique structural features including cumulative dividends and adjustable dividend rates that management can increase monthly or decrease based on one-month SOFR rate movements. This flexibility enables MicroStrategy to optimize capital costs while providing investors with rate adjustment mechanisms tied to broader interest rate environments.
Aggressive Bitcoin Accumulation Continues
MicroStrategy currently holds 607,770 BTC worth approximately $43 billion, representing the world's largest corporate Bitcoin treasury. The company has consistently allocated capital from debt and equity offerings toward expanding its cryptocurrency reserves, reinforcing its commitment to Bitcoin as a primary treasury asset.
Major investment banks including Morgan Stanley, Barclays, Moelis & Co., and TD Securities are managing the transaction, highlighting the institutional sophistication of MicroStrategy's capital markets operations. The Stretch offering represents the fourth preferred equity product following successful STRD, STRF, and STRK launches.
MicroStrategy's systematic Bitcoin accumulation strategy continues influencing corporate treasury decisions globally. The company recently added 4,225 BTC through four at-the-market equity offerings totaling $472.5 million, demonstrating sustained execution of its Bitcoin-first approach despite market volatility.
Legal Challenges Don't Deter Markets
Despite fundraising success, MicroStrategy faces a Delaware Court of Chancery class-action lawsuit filed July 21 regarding amendments to existing Series A Perpetual Strike Preferred Stock (STRK) terms. Plaintiff David Dodge alleges Delaware General Corporation Law violations related to liquidation preference changes made without required shareholder approval.
The lawsuit claims board members breached fiduciary duties and seeks amendment invalidation, regulatory filing corrections, and damages. MicroStrategy has acknowledged the litigation while stating it cannot assess potential financial impacts during early proceedings stages.
Market confidence remains largely intact despite legal uncertainties, with MSTR shares trading around $413 on Thursday. The stock has delivered impressive returns with 37% year-to-date gains and 146% appreciation over twelve months, closely tracking Bitcoin's price performance and broader institutional cryptocurrency adoption trends.
