Are MicroStrategy's Bitcoin Purchases On Hold In January?

MicroStrategy MSTR, known for its aggressive Bitcoin BTC/USD acquisition strategy, may temporarily pause its purchases in January due to an alleged blackout period.

What Happened: Speculation about the potential halt stems from claims that the company could suspend issuing convertible debt or conducting “at-the-market” (ATM) share sales to fund Bitcoin buys, Protos reported.

These reports have prompted widespread discussion among investors.

Benzinga has reached out to MicroStrategy for a comment.

The claim originated from a venture capitalist who suggested that MicroStrategy is entering a blackout period prohibiting the issuance of new convertible debt in January.

This assertion has not been confirmed by MicroStrategy or its executives, but it has raised questions about the company's operational procedures and funding strategies.

Some observers believe the rumored blackout may be linked to self-imposed restrictions companies often adopt to ensure compliance with securities regulations.

While the U.S. Securities and Exchange Commission does not mandate such blackout periods, they are commonly implemented between the close of a fiscal quarter and the release of earnings reports.

These measures are designed to prevent the misuse of non-public information for trading advantages.

Also Read: Senator Lummis Introduces Strategic Bitcoin Reserve Proposal

Why It Matters: MicroStrategy has regularly observed a consistent pattern of Bitcoin acquisitions, largely funded by convertible debt offerings and ATM share sales.

The potential suspension of these activities has raised questions about the impact on the company's Bitcoin buying streak. However, the precise details surrounding this alleged pause remain unclear.

The company is expected to release its earnings report between Feb. 3-5, 2025.

If a blackout period is in effect, it could align with this schedule, as many companies refrain from significant financial activities in the lead-up to earnings announcements.

Questions have also arisen regarding whether the rumored restriction applies solely to ATM share sales, convertible debt offerings, or both.

MicroStrategy's recent inclusion in the NASDAQ 100 index on Dec. 23 may also play a role, as companies often reassess their governance and disclosure practices following such milestones.

Ultimately, any decision to enforce a blackout period would be determined by MicroStrategy's board of directors. Such a measure would reflect the company's commitment to regulatory compliance and transparency.

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