MicroStrategy (MSTR) Pops 3% After Saylor Announces 10 For 1 Stock Split

Shares of Bitcoin developer MicroStrategy rose 3% on Thursday after the company’s CEO, Michael Saylor, announced that it will soon undergo a 10-for-1 stock split.

This move will make it much easier for smaller investors to gain minimal exposure to MSTR, which left them in the dust during its early-year rally alongside Bitcoin.

Make MicroStrategy more affordable

On Thursday press release On the company’s part, the measure will apply to all holders of MicroStrategy’s Class A and Class B common stock. For every share they already own as of August 1, 2024, they will receive nine additional shares after the close of trading on August 7.

The split “will make MicroStrategy stock more accessible to investors and employees,” the company wrote in a press release Thursday. “The stock split will be effected by distributing a stock dividend to holders of MicroStrategy’s Class A common stock and Class B common stock as of the close of business on August 1, 2024, the record date for the dividend.”

A stock split is when a company divides its existing stock into smaller subunits that are easier to purchase individually. This is effectively accomplished by issuing more shares in a predetermined ratio to all existing stockholders.

This will not affect each investor’s overall stake in MicroStrategy, although it does significantly dilute the value of the individual stock. As such, once the stock split takes effect at the opening bell on August 8, MSTR shares will likely be worth a fraction of their current price.

In May, Stoker Advertise It has tokenized MSTR shares as CMSTR on Bitcoin’s Liquid sidechain, allowing investors to effectively trade as little as 0.01 MSTR.

MSTR Guide

As of Wednesday, MSTR was trading at $1,356, while the company has a market cap of $24 billion, according to Google Finance. The stock is up 97% year-to-date, far outpacing BTC’s 30% rise during that period.

Similar to the performance of altcoins historically, MicroStrategy has been closely correlated with Bitcoin throughout the year, but with greater volatility in both ups and downs. The company is the world’s largest active holder of the asset, with 226,331 Bitcoins worth $13.04 billion on its balance sheet.

MicroStrategy has sold several convertible bonds worth nine figures to raise the money it needs to buy more bitcoin over the course of the year. Now, smaller publicly traded companies are copying its approach to tapping the capital markets to buy more bitcoin, including Semler Scientific (SMLR) and Metaplanet.