Michael Saylor unveiled On August 18, that strategy (formerly Micro Strategy) revised its policy for share issue in the midst of the current downward trend of the financial instrument.
The company previously had limited share sales under 2.5x market-network-asset value (MNAV) strictly to cover debt interest or preferred share dividends. According to the new rules, the company can now publish shares under this threshold if it considers it strategically beneficial.
MNAV measures how the market appreciates the company compared to its assets, including Bitcoin companies and operational resources. The earlier limit was intended to protect shareholders against dilution.
However, by relaxing this limitation, the strategy gets more flexibility to attract capital or accelerate Bitcoin acquisitions, which indicates an willingness to act opportunistically in a volatile market.
In the meantime, the update is coming because MSST shares have fallen around 15% in the past month, tailored to $ 363.6, their lowest level since April, according to Yahoo Finance facts.
As a result, strategy tracker facts The NAV premium of the company now shows only 1.59, the narrowest gap between market price and Bitcoin equivalent net asset this year.
Nevertheless, the strategy remains the world’s largest Bitcoin holder, with 629,376 BTC worth around $ 72 billion from the moment of the press.
Investors’ reaction vary
The policy shift of the strategy has drawn mixed reactions from investors in the company.
James Chanos, a famous short seller who has taken a position against the company led by Saylor, criticized The change, which claims that it weakens the protection against the dilution of the shareholder and signals the limited demand for the company’s preference shares.
In the meantime, other market experts see the adjustment as a tactical step that would help strategy to help acquire more bitcoin.
Cern Basher, Chief Investment Officer at Briljant Advies, noted That as long as MNAV remains above 1.0, the issue of new equity Bitcoin per share can increase, for the benefit of existing shareholders.
According to Basher:
“If the strategy is now able to spend new equity in MNAVs up to 1.0, they effectively have two methods (issuing stock and ordinary shares) to acquire more Bitcoin (each helps the others). Think of it as two separate taps to fill a bathtub – so that you can fill the bath faster. “
However, he noted that although “strategy runs a risk to acquire too much bitcoin too quickly”, Shareholders must want it to quickly become the financial fort of the world, because this would open them for more market opportunities.