It Bought Bitcoin And Sold Stock. Microstrategy Has Allied With Bitcoin.

There has been an increase in Bullishness on the Bitcoin market in the past year, even if MicroStrategy MSTR +0.30% stock hasn't passed a pivotal point. With an overhanging loan now paid off, investors shouldn't be surprised to see no signs of slowing down on the cryptocurrency market.

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After Michael Saylor stepped down from being the CEO of MicroStrategy last year, he now leads the company as chairman after leaving the company as Chairman. MicroStrategy (ticker: MSTR) is a business intelligence company founded by Michael Saylor, a high-profile Bitcoin bull. As one of the few public companies to hold significant quantities of digital assets in its corporate treasury along with Tesla TSLA –2.33% (TSLA), MicroStrategy is also expanding its core business to encompass crypto software development.

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Its bullishness towards Bitcoin doesn't appear to be slowing down any time soon.

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It has been revealed in a filing by the company that it acquired approximately 6,455 Bitcoins for $150 million in cash between Feb. 16 and March 23, with an average price of around $23,238 per coin, including fees and expenses, during the period. With an average price of $29,817 per cryptocurrency, MicroStrategy now holds 138,955 Bitcoins, which is equivalent to a value of around $3.8 billion at current prices.

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Although MicroStrategy's crypto holdings are underwater overall, it bought the dip amid a major rally on Tuesday as bitcoin was trading around $27,000. As investors pile back into risk-sensitive assets amid expectations of more accommodative U.S. monetary policy, bitcoin is showing no signs of reversing course, having surged from around $16,500 to around $27,000 at the start of the year.

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According to MicroStrategy's filing, it also paid off a loan to Silvergate Capital SI +2.46% , a crypto-focused bank that collapsed earlier this month following an overnight bank run. It freed itself from the loan, due to maturity in March 2025, by prepaying $161 million to the bank.

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In filings with the Securities and Exchange Commission, MicroStrategy also said that the prepayment was made with $5 million in cash held at Silvergate as well as proceeds from the sale of stock. A total of $339 million worth of stock was issued and sold by the group between the beginning of the year and March 24, which is almost the entire amount of the $500 million stock sale agreement entered into with Cowen and BTIG last year.

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In addition to freeing MicroStrategy from its ties to the bank that collapsed, it also releases the 34,619 Bitcoins that were held as collateral for the loan, which are worth around $940 million. As well as being able to use these Bitcoins as collateral for a loan to buy more cryptos, they could also be used as collateral for another loan.