MacroStrategy, a subsidiary of business intelligence firm MicroStrategy, has said it will buy Bitcoin after acquiring a multi-million dollar loan from Silvergate Bank.
In an announcement Tuesday, MicroStrategy said Silvergate had issued a $ 205 million loan “secured by certain Bitcoin held in the MacroStrategy escrow account.” The firm’s subsidiary, MacroStrategy, has secured loan proceeds to buy Bitcoin (BTC), pay fees and interest associated with the loan, and handle general corporate expenses.
“The SEN leveraged loan offers us the opportunity to improve our position as the leading public company investing in Bitcoin,” said Michael Saylor, CEO of MicroStrategy. “By using the loan capital, we have effectively turned our Bitcoin into productive collateral, enabling us to further execute our business strategy.”
MacroStrategy, a subsidiary of @Mikrostrategiehas entered into a $ 205 million bitcoin-secured loan with Silvergate Bank to buy #bitcoin. $ MSTR $ SIhttps://t.co/QYw2ZgeE3U
– Michael Saylor⚡️ (@saylor) March 29, 2022
Launched in 2020, the Silvergate Exchange Network leverage service allows businesses to borrow US-backed BTC. According to the bank, he had approximately more than $ 570 million in liabilities as of December 31.
Since making a $ 250 million BTC investment in August 2020, MicroStrategy now owns billions of cryptocurrencies after separate purchases using the company’s cash on hand and proceeds from senior convertible note sales in private offerings to institutional buyers. With the price of BTC at $ 47,806 at press time, the company’s 125,051 coins are worth about $ 6 million.
Related: MicroStrategy HUB Will Not Sell $ 5B BTC Stash Despite Crypto Winter
Silvergate has helped provide capital to many companies involved in the cryptocurrency and blockchain industry. In October, the bank issued a $ 100 million credit line to crypto-mining company Marathon Digital to finance itself and the number of BTC miners. Crypto.com announced a partnership with Silvergate in November with the goal of enabling institutional clients to deposit and withdraw with US dollars in return.