MicroStrategy Aims for a Major Milestone

MicroStrategy (MSTR) may soon hit a significant achievement. According to BitMEX Research, the company is merely two trading days away from securing a 20-day streak of closing above $186.23 within a 30-day span.

A recent tweet from BitMEX Research indicates that MicroStrategy's stock has consistently closed above $186.23 for 18 of the last 28 trading days. If this pattern continues for the next two days, MSTR will successfully close above this crucial threshold for 20 trading days in a 30-day timeframe.

Since the downturn of the crypto markets two years ago, MicroStrategy has outperformed nearly all major U.S. stocks, including AI leader Nvidia Corp (NASDAQ: NVDA).

In the past week, MicroStrategy's stock nearly reached a more than two-decade high of $258.24 as Bitcoin approached its all-time high of nearly $74,000, which was set in March. This year, shares have surged over 300%, far surpassing Bitcoin's approximate 70% rise, primarily due to Executive Chairman Michael Saylor's leveraged investment strategy.

What This Means

MicroStrategy’s progress has garnered significant attention because of its aggressive strategy of accumulating Bitcoin, positioning it as one of the largest corporate holders of the asset.

BitMEX's recent blog post assessed MicroStrategy's outstanding bonds, examining their structure and convertibility options. This analysis adds to the anticipation surrounding MSTR’s potential milestone.

According to BitMEX, MicroStrategy has the right (but not the obligation) to redeem the bonds for cash payments on or after a certain date. This option is exercisable only if the stock trades more than 30% above the conversion price for any 20 days (consecutive or non-consecutive) within a rolling 30-day trading window.

As the cash option date for MSTR's zero-coupon bonds has already passed in February 2024, and the conversion price is set at $143.25, a 30% premium amounts to $186.23. MSTR is right on the verge of closing above this threshold for 20 days in a 30-day window, making this option feasible. Exercising this choice would generate added value for MSTR shareholders, although bondholders might hinder this by using their conversion rights.

This article was originally published on U.Today.