The increase is four times that of Bitcoin during the same period, and MSTR needs to raise another $42 billion to continue buying coins!

Through significant financing to purchase Bitcoin and achieve "tenfold returns," MicroStrategy has decided to increase its financing to further gather ammunition for the "Bitcoin buying frenzy."

On October 30th, while announcing its third-quarter report, MicroStrategy unveiled a "21/21 plan," which aims to raise $42 billion over the next three years through $21 billion in equity and $21 billion in bonds to purchase more Bitcoin.

Of the $21 billion in equity financing, over $3.5 billion has already been raised, far exceeding Tesla's $10 billion equity financing in 2020.

MicroStrategy employs banks to sell stocks through a so-called "at-the-market offering," which allows the company to sell shares without submitting additional regulatory documents, or if submitted, to raise all funds in one go.

It is reported that the financing scale's figures relate to the answer "42" calculated by the supercomputer in the sci-fi series "The Hitchhiker's Guide to the Galaxy" regarding life, the universe, and everything, which MicroStrategy's executive Phong Le referred to as a "unique number with special characteristics."

Phong Le also stated that 21 is a magical number in the Bitcoin world, as the maximum supply of Bitcoin will always be 21 million.

"All In" on Bitcoin

Since the pandemic, MicroStrategy has been investing in Bitcoin to hedge against inflation, and its continuous purchases over the years have made it the company with the largest Bitcoin holdings among U.S. publicly traded companies. As of September, MicroStrategy held over 250,000 Bitcoins, valued at over $17 billion as of October 31.

As a result, MicroStrategy is considered a "Bitcoin proxy," and its stock price is deeply tied to Bitcoin. Initially buying with cash flow, it later leveraged funds through convertible notes and other instruments, leading to a stock price increase that even outpaced Bitcoin.

In the past year, MicroStrategy's stock price has risen by about 475%, more than four times Bitcoin's 105% increase during the same period.

In an August conference call, MicroStrategy proposed a unique performance metric: Bitcoin yield. This metric measures the ratio of the company's Bitcoin holdings to its outstanding shares. Management has currently raised the company's annual Bitcoin yield target for the next three years from 4%-6% to 6%-10% to reflect the expected impact of the "21/21 plan."

Wall Street Journal previously mentioned that analysts have differing views on MicroStrategy's future market outlook On one hand, some analysts believe that the current stock price is already too high compared to the asset value and is not expected to rise further. On the other hand, some analysts believe that next year's new accounting standards will value the company's held Bitcoin at market price, thereby reversing MicroStrategy's loss situation, and the company's stock is still worth "buying."

Benchmark Intech analyst Mark Palmer stated that the latest financing plan has eliminated any doubts about whether MicroStrategy will continue its Bitcoin acquisition strategy during the rise of the Bitcoin market.

Palmer predicts that if MicroStrategy proceeds with the "21/21 plan," MSTR stock could be worth $300. His model assumes that the price of Bitcoin will continue to rise, expecting it to reach $175,000 by the end of 2025.