Silvergate awards Bitcoin-assured loan to the subsidiary of Microstrategy

Silvergate awards Bitcoin-assured loan to the subsidiary of Microstrategy

The Silvergate Bank has granted the Microstrategy subsidiary Macrostrategy a loan of $ 205 million, which enables the company to buy more Bitcoin.

The interest loan is secured by Bitcoin, which is stored in the MacRostrategy security account. The loan not only enables the company to buy more bitcoins, but can also be used to settle expenses in connection with the loan transaction or for general corporate purposes, according to a company announcement from Tuesday.

The loan was awarded as part of the Leverage program of the Silvergate Exchange Network (sen). Sen Leverage was founded in 2020 and grew to around $ 570 million of obligations by December 31.

"[Microstrategy’s] The innovative approach to treasury management is an extraordinary example of how institutions can use their bitcoins to support and expand their business," said Alan Lane, CEO of Silvergate.

A Silvergate spokesman rejected another statement.

Microstrategy bought 10,300 bitcoins at an average price of $ 57,113 after a capital increase due to the company's share offer. The analysis and business intelligence company based in Virginia bought another 660 bitcoins for around $ 25 million in cash between December 30 and January 31-which corresponds to $ 37,865 per bitcoin.

The purchases brought the company's entire Bitcoin stock to 125,051, which were acquired for almost $ 3.8 billion. Microstrategy is the world's largest listed Bitcoin owner.

About 110,000 of the company's bitcoins are not pledged as security and could be used to generate returns or for leverage, said Michael Saylor, CEO of Microstrategy, during a prize request on February 1.

he added that the company was planning to continue to use the free cash flow for buying further bitcoins, and possibilities for the procurement of additional capital as a possibility to buy digital assets.

"Sen-Leverage loan gives us the opportunity to expand our position as the leading investor of stock corporations in Bitcoin," said Saylor in an explanation.

"With the capital from the loan, we effectively convert our bitcoins into productive collateral that enable us to further implement our business strategy."

A Microstrategy representative did not answer a request for comment immediately. According to Blockworks at 11 a.m., the price of Bitcoin was around $ 47,800 - an increase of 0.5 % in the last 24 hours and about 16.4 % compared to seven days.

. .

The article Silvergate provides Bitcoin-assured loans to Microstrategy subsidiary from is no financial advice.