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MicroStrategy (MSTR) might be on the verge of achieving a significant milestone. According to BitMEX Research, MSTR is just two trading days away from maintaining a 20-day streak of closing above $186.23 within a 30-day window.
In a recent tweet, BitMEX Research highlights that MicroStrategy's stock has held steady, maintaining a closing price above $186.23 for 18 out of the last 28 trading days. If this trend continues for the next two days, MSTR will have closed above this critical threshold for 20 trading days within 30 days.
Since the collapse of the crypto markets two years ago, MicroStrategy has outperformed almost every major U.S. stock, including AI bellwether Nvidia Corp.
Tomiwabold OlajideIn the past week, MicroStrategy neared a more than two-decade high of $258.24 as Bitcoin surged toward its all-time high of nearly $74,000 set in March. The shares have risen by more than 300% this year, beating Bitcoin's roughly 70% advance, thanks to Executive Chairman Michael Saylor’s leveraged investment strategy.
What this means
MicroStrategy’s trajectory has been closely followed due to its aggressive Bitcoin accumulation strategy, which has positioned the company as one of the largest corporate holders of the cryptocurrency.
In a recent blog post, BitMEX research examined MicroStrategy’s outstanding bonds, taking a look at their structure and convertibility options. Thus, the anticipation surrounding MSTR’s potential milestone.
As explained by BitMEX, on or after a specific date, MicroStrategy has the right, but not the obligation, to redeem the bonds and pay the holders cash. This right can only be exercised if the stock trades more than 30% above the conversion price, for any 20 days (consecutive or not) in any rolling 30-day trading window.
With zero coupon bonds, the MSTR cash option date of February 2024 has already passed. The conversion price is $143.25, and a 30% premium to this is $186.23. This option is close to coming into play as MSTR is set to close above $186.23 for 20 days within a 30-day window. Exercising this option would create value for MSTR shareholders, but bondholders may be able to prevent this by exercising their conversion rights.
Alex Dovbnya
Vladislav Sopov
Dan Burgin
U.Today Editorial Team