MicroStrategy's recent announcement of significant stock sales and bitcoin acquisitions has stirred investor concerns, leading to a notable decline in its stock price. The company disclosed in an SEC 8-K filing that it sold over 2.7 million shares, raising approximately $1.1 billion, which was used to purchase 10,107 bitcoins at an average price of $105,596 per bitcoin. This move has raised eyebrows due to the high purchase price of the bitcoins, which surpasses the current market value, and the potential dilution effect from the new share issuance. Investors seem wary of the risks associated with MicroStrategy's concentrated investment strategy in bitcoin, contributing to the stock's downward trajectory.
The Defiance Daily Target 1.75x Long MSTR ETF (MSTX) experienced a significant drop, falling 8.97% to $44.47 as of 8:00 AM on Monday, January 27.