MicroStrategy, led by CEO Michael Saylor, has once again displayed its unwavering commitment to Bitcoin, purchasing an additional 5,445 Bitcoins for approximately $147.3 million. The acquisition occurred between August 1 and September 24, with an average price per Bitcoin of $27,053, as reported in a recent Securities and Exchange Commission filing.
This latest acquisition has significantly boosted MicroStrategy’s Bitcoin holdings to a staggering 158,245 Bitcoins. While the total cost of accumulating this digital gold amounts to around $4.68 billion, the current market value sits at approximately $4.12 billion. This marks a 12% decline from the purchase price to the present market value, indicating that the company remains in a loss position.
For MicroStrategy to break even or turn a profit on its Bitcoin holdings, the cryptocurrency’s price would need to surpass $29,582 per Bitcoin, which represents a 13% increase from the current trading price of around $26,116.
It’s worth noting that in the second quarter of 2023, MicroStrategy reported $24 million in impairment losses related to its digital asset holdings. This figure marks a significant decrease compared to the same quarter in the previous year when the company reported $917 million in impairment losses.
While MicroStrategy’s fate is closely tied to Bitcoin’s performance, the company’s stock price has seen substantial fluctuations. In Q2, its shares rose to a year-to-date peak of $462.30 before experiencing a significant decline to $318. This 30% drop eclipses the 17% drawdown observed in Bitcoin’s price during the same period.
Despite these challenges, MicroStrategy’s continued commitment to Bitcoin could influence the cryptocurrency’s price positively. Recent indications in the market suggest a potential rise toward $27,423 and beyond. Michael Saylor’s company’s persistent accumulation of Bitcoin may contribute to bolstering the cryptocurrency’s value in the coming days.
MicroStrategy’s latest Bitcoin purchase underscores its confidence in Bitcoin’s role as a store of value and a long-term investment. The company initiated its cryptocurrency accumulation strategy in August 2020, with a primary focus on using Bitcoin as a hedge against inflation. As CEO Michael Saylor puts it, their strategy revolves around “buying and holding Bitcoin” with an emphasis on transparency and responsibility.
Despite the market’s challenges, MicroStrategy managed to achieve profitability in Q1 2023 and sustained profitability in the second quarter, posting $22.2 million in net income, even after factoring in a $24.1 million impairment charge related to its Bitcoin holdings.
As MicroStrategy’s Bitcoin journey continues, it remains a prominent player in the crypto space, closely watched for its bold and steadfast approach to digital asset investment.