Bitcoin bull Michael Saylor made $370 million from MicroStrategy sales

micro strategy Founder and Bitcoin evangelist Michael Saylor entered into a stock sale plan with the company last summer that allows him to sell up to 400,000 shares in the first four months of 2024.

It was a timely agreement for the 59-year-old cryptocurrency billionaire.

The plan is more than 90% complete, and thanks to MicroStrategy's phenomenal rise in value, Mr. Saylor netted about $370 million in stock sales this year. Bitcoin holding company.

Saylor, who founded MicroStrategy as a software and technology consulting business in 1989 and still serves as its chairman, has emerged as a Bitcoin hero in recent years, telling CNBC last month that the cryptocurrency “is eating up money. ” he said. Since announcing its strategy to enter the crypto market in mid-2020, his company has leveraged its balance sheet and capital markets to acquire more than 214,000 Bitcoins.

These assets represent about 1% of the total number of Bitcoins minted to date and are currently worth about $13.6 billion, making up the bulk of MicroStrategy's $21.3 billion market cap. The stock has recently become a darling of Wall Street, and after soaring 346% in 2023, it's up 91% this year despite falling 37% from its March high and leading the overall U.S. stock market. It is one of the best performing stocks.

Saylor is MicroStrategy's largest shareholder, with Class B holdings worth approximately $2.3 billion. At the end of 2023, Mr. Saylor owned an additional 400,000 Class A shares through options he received in 2014. He is selling these stocks in a hurry.

MicroStrategy, which was buried near the end of its third-quarter earnings report on Nov. 1, said the company and Saylor entered into an agreement in September called a 10b5-1 plan that allows the founders to sell up to 5,000 shares each year. announced that it had done so. Trading days from January 2nd to April 25th of this year, up to a total of 400,000 shares. The shares were said to have “vested stock options attached that, if not exercised, would expire on April 30, 2024.”

As of this week, Saylor had sold 370,000 shares for a total of $372.7 million, according to filings. His Class A stock holdings have fallen to 30,000 shares as of the latest sale disclosed on Thursday.

MicroStrategy did not respond to a request for comment.

Benchmark analyst Mark Palmer said the stock sale was “completely programmatic” due to a trading scheme executed last year and did not reflect Mr Thaler's confidence in MicroStrategy or his view of the stock price in any way. said.

However, there is a different perspective in the world of retail investors.Many posts about reddit Some members of the r/MSTR subreddit have speculated that Saylor is using the cash to buy Bitcoin directly, and that Saylor is probably selling it for other reasons. It suggests that. Some people say they sell it together with sailors. Stocks fell 29% in April, and Bitcoin fell 11%.

Palmer, who rates the stock a “buy,” countered that such a view “would be misleading” for investors and traders.

“What we're seeing here is very straightforward, and it's all already been made clear,” Palmer said. “It's easy for people who don't understand the details, or who do understand the details but might be shorting the stock, to twist the situation a little bit. As is often the case, finding the truth is Easy enough.”

Even with the stock sale, the bulk of Saylor's wealth remains in MicroStrategy, a Class B holding, along with the 17,732 Bitcoins he bought in 2020, currently worth about $1.1 billion.

Much of the rise in Bitcoin and related investments has to do with the emergence of Bitcoin exchange-traded funds (ETFs), which received regulatory approval earlier this year, and the halving, which will take place this week. This technical event occurs every four years and cuts the rewards for Bitcoin miners in half, slowing down the pace at which new Bitcoins enter the market.

In a market where consumers can buy Bitcoin directly on a variety of exchanges or choose from a number of new ETFs, MicroStrategy's continued advantage is leveraged Bitcoin play with no management fees. Sailor said.The company said last month it could raise funds to delve deeper into cryptocurrencies. He extorted $782 million “to acquire additional Bitcoins.” The cash was obtained from the sale of convertible bonds at an interest rate of 0.625%.

“Is there a company in the world you wouldn't want to invest in that could borrow $1 billion at less than 1% interest to invest in your best idea?” Saylor told CNBC's “Squawk Box” in March. He said this. He added that the company's leverage creates volatility, which “attracts capital and allows us to leverage more leverage.”

Benchmark's Palmer said there are many reasons to remain bullish on MicroStrategy, especially with the halving looming. After past halving events, the price of Bitcoin skyrocketed.

“If I were in a situation where I owned MicroStrategy stock, now is the time I would want to hold onto it,” Palmer said.