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MicroStrategy subsidiary borrows $205 million to buy Bitcoin

Updated: Aug 31, 2024
Published: Mar 29, 2022
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Michael Saylor, CEO of MicroStrategy, announced that the company's subsidiary, MacroStrategy, has borrowed $205 million to acquire Bitcoin.

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Macrostrategy receives a $205 million collateral loan 

According to an article by MicroStrategy, the loan was provided by Silvergate Bank, a subsidiary of Silvergate Capital Corporation, a leading provider of innovative financial infrastructure solutions in the cryptocurrency space. MacroStrategy received a $205 million loan from the bank as part of the Silvergate Exchange Network (SEN) leverage program.

The $205 million will be used to purchase Bitcoin and cover fees, interest, and other costs associated with the transaction. The loan was secured by the Bitcoin held in MacroStrategy's collateral account. Both this company and Silvergate authorized the custodian that holds the Bitcoin.

What amount of Bitcoin does Microstrategy hold?

MicroStrategy has continued to amass Bitcoin in recent months, and its CEO has emerged as one of Bitcoin's most outspoken supporters. Saylor announced MicroStrategy's latest BTC purchase on Feb. 1. The company currently holds a total of $4.8 billion in the leading digital currency.

"The SEN Leverage loan gives us an opportunity to further our position as the leading public company investor in bitcoin,” MicroStrategy CEO Michael Saylor said in the press release. “Using the capital from the loan, we’ve effectively turned our bitcoin into productive collateral, which allows us to further execute against our business strategy.”

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