Key Takeaways
MicroStrategy has quadrupled its preferred stock offering to $2.8 billion to advance its BTC acquisition. Will its growing debt become a risk factor?
MicroStrategy has reportedly increased its latest preferred perpetual stock, Stretch (STRC), offering from $500M to $2.8 billion.
This was a 4x expansion from the initial plan, and the proceeds will help the firm acquire more Bitcoin [BTC].
According to a Bloomberg report, big players like Morgan Stanley and Barclays had already shown interest in the new stock offering, underscoring the firm’s aggressive capital raising method to meet its BTC vision.
Strategy’s BTC bet
Strategy is the pioneer in BTC corporate treasury with 607,770 BTC worth over $70 billion based on the current market prices.
It began its BTC acquisition in 2020 and has increased its stash via stock sales and debt issuance.
The latest perpetual stock STRC joins Stride (STRD), Stark (STRK), and Strife (STRF), and the main share MSTR, as part of the firm’s capital raising arm on the stock issuance side.
Michael Saylor, founder of the firm, calls them the ‘BTC defense department.’
On the debt front, Strategy has also actively issued convertible bonds to drive its BTC vision. As of March 2025, the firm had over $8 billion in total debt, and about half of it ($3.65 billion) will mature by mid-2028.
But critics have warned that excessive leveraged debt for BTC could increase risk exposure to the crypto and TradFi sectors.
To prevent or minimize the impact of such a scenario, especially amid BTC treasury frenzy, Jake Chervinsky, legal chief at Variant Fund, urged the players to be prepared for downside risks.
“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 dismissed such debt fears as overblown at the moment, stating that the risk could become crucial in 2028 (first maturity period).
Meanwhile, MSTR analyst Jeff Walton hailed the upsized STRC offering, adding that about 25K BTC will be bought in the next 10 days.
As of press time, MSTR was valued at $405, down 12% from the recent high of $457.22. This followed the recent BTC slump to $115K. But from the April low, the stock was up 72%.
Source: MSTR, TradingView
