Biggest Bitcoin Corporate Investor Buys Additional $ 414 Million As Omicron Variant Puts Crypto Prices Under ‘Series Pressure’

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Top line

MicroStrategy, the data analytics firm led by bullish cryptocurrency billionaire Michael Saylor, announced another big bitcoin investment on Monday morning, doubling its staggering commitment to the world’s largest cryptocurrency as the Emerging market suffers a correction of nearly 15% this month and the threat of a new variant of the coronavirus.

The company run by billionaire Michael Saylor made one of its biggest bitcoin purchases in the middle of … [+] the latest rout of the crypto market.

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In a regulatory filing released Monday, Virginia-based MicroStrategy, which has more bitcoin than any other company in the world, revealed that it bought around 7,002 bitcoins for around $ 414.4 million in cash, or $ 59,187 per piece, between October 1 and November 29.

The company says it now owns around 121,044 bitcoins, purchased for almost $ 3.6 billion, with an average price of $ 29,534 for each bitcoin.

Its latest investment comes as the price of bitcoin struggles near a seven-week low after fears over a newly identified variant of the coronavirus, dubbed omicron, ravaged the wider market on Friday.

At around $ 57,000 on Monday morning, the price of bitcoin fell almost 18% from a high of around $ 69,000 set earlier this month, but it is still up 94% from Last year.

MicroStrategy helped fund the purchase using the proceeds from a previously disclosed stock sale in June that has so far raised approximately $ 414.4 million from the sale of 571,000 shares in the fourth quarter.

Shares of MicroStrategy, which also used newly issued debt to buy bitcoin during the pandemic, jumped about 4% in pre-market trading on Monday and rose nearly 60% this year despite a drop in 5.4% Friday.

Key context

Thanks to its growing investment in bitcoin, which is matched only by Tesla’s 42,000 coins, MicroStrategy’s shares have seen a startling turnaround since the dot-com bubble caused prices to fall about two decades ago. The stock has climbed more than 350% since the company started buying bitcoin in August 2020, although it has also been incredibly sensitive to the outsized volatility of the nascent crypto market. The stock is still down almost 36% from a 21-year high in February, when bitcoin prices recently skyrocketed after Tesla CEO Elon Musk said on Twitter that its prices seemed “a little high”. At the time, Saylor, who Forbes estimates at around $ 2.4 billion, said the company’s growing investment “reaffirms [the firm’s] belief that bitcoin, as the world’s most widely adopted cryptocurrency, can serve as a reliable store of value.

Tangent

Crypto’s wild price swings only intensified this month, with the price of bitcoin falling to its lowest price since mid-October on Friday. After peaking at nearly $ 3 trillion on November 10, the crypto market now sits at a total market cap of less than $ 2.6 trillion.

Surprising fact

MicroStrategy has more bitcoin than any publicly traded company, but in its namesake bitcoin fund, investment manager Grayscale owns 654,885 tokens, worth more than $ 32 billion on Tuesday.

Versus

Despite bitcoin’s explosive gains during the pandemic, not everyone is convinced that the volatile asset has turned out to be a reliable store of value and inflationary hedge. “In recent weeks we have seen that in times of real uncertainty, bitcoin has not performed well as an inflation hedge or a safe haven,” Oanda analyst Craig Erlam said in a report. -mail as prices struggled on Friday. “There is no doubt that it is a fascinating and highly speculative negotiable instrument, but it is now clear that it is a risky asset and nothing more, for the time being anyway.” If the new variant fuels further market losses, Erlam says bitcoin prices “could come under serious pressure.”

Further reading

Bitcoin’s biggest corporate investor buys an additional $ 177 million, raising its holdings to $ 5.4 billion as crypto’s massive comeback (Forbes)

Biggest Bitcoin Corporate Investor Raises $ 500 Million To Buy More, Beating Expectations As Crypto Rises (Forbes)

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