Why can the stock "CASK" of $IP Microstrategy be bought? The answer is written in the details of the financing plan, which 99% of people have overlooked. After reading the trading structure, I found the term "prepaid warrants" in the financing plan! It's necessary to explain this financing tool. Overall, CASK's financing is 220 million, of which 100 million comes from the sale of existing shares, in other words, selling equity, and the other 120 million is through the issuance of new shares. Delivering existing equity will not affect the stock price, but issuing new shares dilutes the value per share, which will lead to a drop in stock price. Yesterday, as this plan was announced, CASK's stock price also fell by 30%. In fact, the transaction has not yet been completed; it will be finalized on the 13th, but the market has already reacted to this information. However, the new shares are prepaid warrants, which means they will not immediately increase the total number of shares. Prepaid warrants mean that the buyer pays most of the subscription amount upfront, leaving a small balance to be paid when exercising the option. It's somewhat similar to a mooncake voucher; I first spend money to buy a mooncake voucher, and when to exchange it for mooncakes is another matter. In this way, investor A16Z actually gets a bunch of stocks without actually increasing the number of shares. Once the stock price reaches a certain level, the investor can exercise the option to convert the warrants into stocks and sell them. Various microstrategies are really getting more and more intricate. To keep up with the times, I founded the "On-chain Study Group" to discuss together. You are welcome to join us: