MicroStrategy gets $205 million loan to buy more bitcoin

abdelaziz Fathi

MacroStrategy, a wholly-owned subsidiary of MicroStrategy Inc, raised $205 million via an interest-only term loan due 2025. Offered by the crypto-friendly bank Silvergate Capital, the Michael Saylor-led enterprise software company intends to use the net proceeds from the loan to acquire additional bitcoins.


Per an SEC filing, the loan was “secured by certain Bitcoin held in MacroStrategy’s collateral account.” Specifically, the fiat money was granted against a bitcoin holding worth around $820 million, which represents 12% of MicroStrategy’s total crypto holding.

“The loan matures on March 23, 2025, and bears interest at a floating rate equal to the Secured Overnight Financing Rate 30 Day Average as published by the Federal Reserve Bank of New York’s website (0.099% as of the Closing Date) plus 3.70%, with a floor of 3.75% […] The loan may be prepaid at any time, subject to prepayment premiums of 0.50% and 0.25% of the loan amount prepaid for prepayments during years one and two of the loan term, respectively,” the statement further reads.

The loan was collateralised through Silvergate

The transaction was conducted through the Silvergate Exchange Network (SEN) Leverage program. The product, which was first launched in 2020, also allows the bank’s customers to obtain US dollar loans collateralized by their bitcoin holdings at some crypto exchanges that Silvergate is currently serving. Dubbed ‘SEN Leverage,’ the service is a near real-time payments platform that enables users to send US dollars 24 hours a day, 7 days a week, 365 days a year.

Silvergate already counts major crypto exchanges ranging from Kraken to Coinbase as clients. However, the California-based bank abruptly cut ties with Binance last year, but the developments didn’t impact its American affiliate exchange.

Recent data shows that MicroStrategy had added 660 bitcoins to its strategic reserves between December 30, 2021, and January 31. With its most recent purchase, the Virginia-based business intelligence firm holds an aggregate of 125,051 bitcoins, which were acquired at a total cost of around $3.78 billion and an average purchase price of approximately $30,200 apiece. The worth of the company’s total bitcoin holding comes to around $5.9 billion at current prices.

The analytics software maker, run by bitcoin bull Michael Saylor, has taken advantage of any price drop in Bitcoin to continue beefing up its investment in the world’s most-traded cryptocurrency.

Read this next

Retail FX

Malaysia regulator exposes OctaFX clone, shady FB profiles

Malaysia’s financial regulator today warned online investors about the risks of following investment tips made on social-media platforms.

Digital Assets

Crypto trading volume spikes at Swiss bourse amid FTX collapse

The shockwaves from the historic collapse of Sam Bankman-Fried’s crypto empire are still being felt across the industry, but some trading venues are actually doing better because of it.

Executive Moves

CMC Markets adds Camilla Boldracchi to institutional sales

UK’s biggest spread better, CMC Markets has promoted Camilla Boldracchi to take on an expanded role within its institutional sales desk.

Institutional FX

FXSpotStream reports $1.48 trillion in monthly volume for November

FXSpotStream’s trading venue, the aggregator service of LiquidityMatch LLC, reported its operational metrics for November 2022, which moved higher on a yearly basis but reflected weak performance across executed trade volumes when weighed against the figures of the prior month.

Retail FX

Interactive Brokers’ client activity drops 30% YoY

Interactive Brokers LLC (NASDAQ:IBKR) saw 1.95 million daily average revenue trades, or DARTS, in November 2022 compared to 1.96 million transactions in the prior month.

Digital Assets

The rise of Crypto ETPs in traditional exchanges as crypto winter deepens

Institutional investors are increasingly looking at traditional regulated exchanges as their first route into digital assets amid market turmoil caused by the crypto winter and the collapse of several big names within the space, including FTX. Acuiti and Eurex surveyed 191 buy and sell-side firms on their views of the digital assets markets in order […]

Digital Assets

TP ICAP’s crypto arm receives FCA’s go-ahead

UK interdealer broker TP ICAP has received a regulatory go-ahead to launch its cryptocurrency services in the UK. The bid shows that the recent collapse of FTX exchange has done little to damp the interest of big names in running their own crypto business.

Industry News

Coin Signals founder to pay $2,847,743 after prison sentence over crypto Ponzi scam

The U. S. District Court for the Southern District of New York has ordered Jeremy Spence, founder of Coin Signals, to pay $2,847,743 in restitution to victims of a fraudulent virtual currency scheme.

Digital Assets

CME Group goes DeFi: Reference rates and real-time indices of Aave, Curve, Synthetix

“These rates are designed to provide traders, institutions and other users transparency and price discovery across a much broader range of tokens, allowing them to confidently and more accurately value cryptocurrency sector specific portfolios and manage price risk around various blockchain-based projects.”