Why MicroStrategy Stock Jumped on Wednesday
Shares of (NASDAQ: MSTR) jumped on Wednesday after the company announced it had spent a whopping $615.7 million buying Bitcoin (CRYPTO: BTC). As of 2:15 p.m. ET, MicroStrategy stock was up about 9%.
MicroStrategy first started buying Bitcoin as its capital-allocation strategy in 2020. Since then, the company used virtually all of the money it had and took on debt to buy as much Bitcoin as possible. That's why its greater-than $600 million purchase is so surprising -- it only had $45 million in cash as of the third quarter of 2023.
As it turns out, MicroStrategy just sold over 1 million shares, raising $610 million. This supplied the funds to buy Bitcoin.
Source Fool.com
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