MicroStrategy Buys Fresh $150M in Bitcoin; Pays off Silvergate Loan

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Business intelligence company MicroStrategy has topped up its Bitcoin portfolio with an additional 6455 BTC worth around $150 million after paying off its loan to the troubled financial company, Silvergate. 

In a Twitter announcement on March 27, 2023, the company’s co-founder Micheal Saylor, said the firm made the $205 million repayment to Silvergate at a 22% discount.

Recall that last year, the software development company took a multi-million BTC-collateralized loan from the collapsed bank to buy additional bitcoin. 

The loan, which had a scheduled maturity date of March 23, 2023, was secured through the company’s subsidiary MacroStrategy.  

MicroStrategy Pays Back $161 Million to Silvergate

According to a petition with the U.S. Securities and Exchange Commission (SEC), MicroStrategy and Silvergate signed a Waiver and Payoff to Credit and Security Agreement on March 24 regarding the loan. 

Following the agreement, the business intelligence firm paid $161 million to the bank, meeting all obligations of the initial deal. 

“Upon Silvergate’s receipt of the Payoff Amount, the Credit Agreement was terminated. Silvergate released its security interest in all of MacroStrategy’s assets collateralizing the loan, including the bitcoin that was serving as collateral,” the company said. 

Microstrategy Now Holds 138,955 BTC 

Shortly after the repayment, Microstrategy disclosed that it had purchased additional bitcoin, bringing its total holdings to 138,955. 

The firm held around 130 000 of the crypto asset in September 2022. At the time, the virtual assets were valued at $3.98 billion. However, with the latest addition, the value has increased to $4.14 billion. 

Microstrategy’s new batch of BTC was acquired at an average of $23,238 per BTC. If combined with the previous holdings, its total average will amount to $29,817. 

The company has accumulated virtual assets since 2020 after Saylor, who served as the CEO, decided to add bitcoin to the company’s balance sheet as a treasury management strategy. Since then, the firm has been actively topping up its bitcoin bags at intervals.

MicroStrategy is still the largest corporate holder of bitcoin, surpassing other publicly-traded firms engaging with the crypto asset.

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