MicroStrategy, recognized as the foremost corporate holder of Bitcoin (BTC) globally, has recently added 9,245 coins to its inventory at an average price of $67,382 per coin. With this latest acquisition, the company’s total Bitcoin holdings now stand at 214,246 BTC, officially surpassing 1% of the total Bitcoin supply.
Michael Saylor Expands Bitcoin Holdings
According to Michael Saylor, co-founder and chairman of MicroStrategy, the company’s cumulative Bitcoin investment cost now amounts to $7.53 billion, with an average acquisition price of $35,160 per coin. This estimate is approximately aligned with data from saylortacker.com, a platform monitoring MicroStrategy’s Bitcoin investment performance by tracking Saylor’s publicly disclosed purchases of the cryptocurrency.
MicroStrategy has acquired an additional 9,245 BTC for ~$623.0M using proceeds from convertible notes & excess cash for ~$67,382 per #bitcoin. As of 3/18/24, $MSTR hodls 214,246 $BTC acquired for ~$7.53B at average price of $35,160 per bitcoin. https://t.co/oeYJGgiuy0
— Michael Saylor⚡️ (@saylor) March 19, 2024
MicroStrategy’s recent acquisition exceeded its previous book cost and also surpassed Bitcoin’s current market value, which declined by 6% on Tuesday to $63,101. Despite this, the company’s overall investment remains remarkably profitable, boasting unrealized profits of $6.1 billion, marking an 80% increase.
Michael Saylor emphasized that the company has no immediate plans to realize these profits, stating that Bitcoin should be viewed as digital property akin to a valuable asset in cyberspace, suggesting holding it for an extended period, possibly a century.
Saylor further expressed his belief that Bitcoin will outperform gold in terms of market share and predicted that Bitcoin spot exchange-traded funds (ETFs) will soon rival the size of gold ETFs.
He highlighted Bitcoin’s role as a competitor to traditional risk assets for long-term investment and suggested it as an alternative retirement income source, particularly for middle-class individuals considering investments like purchasing Airbnb properties.
MicroStrategy’s Relationship with Bitcoin
MicroStrategy’s recent Bitcoin acquisition is part of a strategic move following the completion of a $603.75 million offering of convertible notes, announced just last week. These notes, with a modest 0.875% coupon rate, are scheduled for repayment in 2031. This acquisition comes hot on the heels of a similar move earlier this month when the company purchased over $821.7 million in BTC subsequent to raising $700 million through convertible notes with an even lower coupon rate of 0.625%.
The bullish sentiment among investors in MicroStrategy’s stock (MSTR) stems from its access to relatively cheap debt, which they view as an advantage compared to direct Bitcoin purchases or investments in Bitcoin ETF shares. Additionally, MicroStrategy boasts a profitable software business, a source of ongoing revenue that can be utilized to acquire more Bitcoin over time, thereby potentially increasing investors’ Bitcoin per share.
While MSTR shares have surged by an impressive 80% year to date, outpacing Bitcoin’s gains of 41% over the same period, the stock has experienced a 24% dip over the past five days. This volatility underscores the dynamic nature of both the company’s strategic maneuvers and the broader cryptocurrency market.
