Will MicroStrategy Have to Sell BTC? Broker Bernstein Chips In (Report)

2023-07-12 12:03:31

MicroStrategy is the world’s largest corporate holder of Bitcoin. The company is currently holding a whopping 152,333 BTC, worth over $4.6 billion at current prices.

One of the most commonly discussed points by crypto traders and investors alike is whether the company has a liquidation threshold and if it will ever have to sell BTC.

Citing a Tuesday report by broker Bernstein, CoinDesk outlined:

MicroStrategy’s plan to raise long-term debt puts it under pressure to liquidate its bitcoin (BTC) holdings, but only in case of extreme price corrections, especially around its debt expiry, which is due in mid-2025.

The report also points out that “the corporate structure would come under pressure from ‘spring forward’ clauses – 2028 due debt does have liquidity covenants which could spring forward the debt to 2025/26.
At the same time, Bernstein argues that if Bitcoin’s price continues increasing, this would make MSTR’s balance sheet strong.
In turn, if MSTR shares increase as well, this would also put MicroStrategy in a better debt-repayment position.
The company last bought BTC toward the end of June, when it added 12,333 BTC, making its current holdings 152,333 BTC.

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