Microstrategy increases its Bitcoin holdings

Microstrategy increases it’s Bitcoin holdings once again

MicroStrategy, a software company that has been steadfastly investing in Bitcoin, has added another 5,445 BTC to its corporate treasury on September 24, 2023. The company paid an average of about $27,053 per Bitcoin, totaling $147.3 million.

Longterm plan for Microstrategy Bitcoin holdings

With this purchase, MicroStrategy now owns a whopping 158,245 BTC, which it bought at an average of around $29,582 per Bitcoin. This means that the company has invested approximately .68 billion in Bitcoin so far. With the average cost per Bitcoin currently resulting in a net loss of over $3000, it is clear that Microstraegy are in it for the longterm.

Michael Saylor Bitcoin maximalist

The CEO of MicroStrategy, Michael Saylor, is a very vocal supporter of Bitcoin and considers it as digital gold and a strategic asset for treasury reserves. This latest purchase reinforces MicroStrategy’s role as one of the most prominent institutional investors in Bitcoin.

Microstrategy using debt to buy Bitcoin

This move is not surprising for those who have been following MicroStrategy’s journey in the crypto space. The company entered the Bitcoin market in August 2020 with its first purchase. Since then, it has continued to buy more Bitcoin, even using debt to fund some of its acquisitions.

Saylor has also maintained that Bitcoin is “underestimated” compared to other crypto market opportunities, repeatedly said that altcoins are overvalued and should be sold. A video by Bitcoin Historian Pete Rizzo is a perfect example of this.

Bitcoin as a store of value in uncertain times

As Bitcoin gains more recognition as a store of value and a potential hedge against economic uncertainty, it will be interesting to see whether more institutions will emulate MicroStrategy’s strategy.

Wisewords: Never create debt to invest in speculation

As mentioned in the article, Microstrategy has in the past used debt to finance the purchases of Bitcoin. Any form of investment is effectively gambling on speculation of gains but as the current price of Bitcoin shows, the investment is underwater at the time of writing.

Ofcourse Microstrategy has investors and other investments in it’s portfolio, but should Bitcoin follow the economic trends showing elsewhere, this holding could be underwater for a considerable amount of time. As such, any debt repayments due on borrowings should be seen as negative equitiy for the duration of lower price levels.

Source: as submitted to the United States Security and Exchange Commission

On September 25, 2023, MicroStrategy Incorporated (“MicroStrategy”) announced that, during the period between August 1, 2023 and
September 24, 2023, MicroStrategy, together with its subsidiaries, acquired approximately 5,445 bitcoins for approximately 7.3 million in cash, at an
average price of approximately $27,053 per bitcoin, inclusive of fees and expenses. As of September 24, 2023, MicroStrategy, together with its
subsidiaries, held an aggregate of approximately 158,245 bitcoins, which were acquired at an aggregate purchase price of approximately .68 billion
and an average purchase price of approximately $29,582 per bitcoin, inclusive of fees and expenses.

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