MicroStrategy Proposes Significant Increase in Share Classes

MicroStrategy, renowned as the largest corporate holder of bitcoin, has introduced a proposal to substantially increase its shares of Class A common stock and preferred stock to optimize its bitcoin strategy.

According to the company’s proxy 14A statement filed with the Securities and Exchange Commission, the proposal seeks to raise the number of Class A common shares from 330 million to 10.33 billion and preferred shares from 5 million to 1.005 billion.

This initiative is part of MicroStrategy’s "21/21" plan, a three-year capital strategy valued at $42 billion, which aims to secure $21 billion in equity capital and an additional $21 billion in fixed-income instruments like debt, convertible notes, and preferred stock, all of which support future bitcoin acquisitions.

Furthermore, the statement disclosed additional company proposals, such as a new equity incentive plan granting automatic equity award grants to new directors.

In an 8-K report filed last Friday, MicroStrategy expanded its board from six to nine members by including Brian Brooks, Jane Dietze, and Gregg Winiarski. Notably, Brooks briefly served as the CEO of Binance in 2021, and Dietze has been affiliated with Galaxy Digital’s board since 2022.

“The proposals we ask you to consider represent a new chapter in our evolution as a bitcoin treasury company and reflect our ambitious future goals,” the statement indicated.

The date for the special stockholder meeting to vote on these proposals has not yet been announced, but it is anticipated for 2025.

With its initial bitcoin acquisition in 2020, co-founder Michael Saylor declared that bitcoin would become MicroStrategy's primary treasury asset.

On Monday, Saylor announced that the company acquired an extra 5,262 bitcoin for approximately $561 million, averaging $106,662 per bitcoin, bringing their total ownership to 444,262 BTC, valued at over $41.6 billion.

While MicroStrategy's bitcoin purchases typically bolster its stock price, it fell 8.78% at closing on Monday to $332.23, marking a 17.6% decline over the past month, according to Google Finance. Nevertheless, MicroStrategy shares have surged 450% in the past year.

In parallel, the bitcoin price decreased by 1.6% in the last 24 hours, settling at $93,932 as of 10:30 p.m. EST, based on data from The Block's bitcoin price page.