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Two weeks after announcing a debt offer to fund the investment, business analysis firm MicroStrategy, which has more bitcoin than any other company in the world, spent nearly $ 500 million to acquire more of the most. largest cryptocurrency in the world, profiting from the fall in prices Monday morning despite the warning. a significant loss to come due to the tanking value of bitcoin.
MicroStrategy CEO Michael Saylor speaks at Bitcoin 2021 convention in Miami.
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Virginia-based MicroStrategy announced Monday morning that it had used around $ 489 million in cash raised last week to buy around 13,005 bitcoin at an average price of around $ 37,617.
With the new investment, MicroStrategy owns around 105,085 bitcoins, worth around $ 3.4 billion, as prices fall nearly 10% from their high on Sunday afternoon.
Led by bitcoin bull billionaire Michael Saylor, the company has so far spent more than $ 2.7 billion to buy bitcoin at an average price of $ 26,080, about 15% below current prices of $ 32,000.
MicroStrategy’s shares have plunged 7% in pre-market trading and are now down more than 49% from a high in mid-February.
Key context
MicroStrategy’s commitment to bitcoin has helped the company’s shares reverse a decades-long lull that began when the dot-com bubble collapsed in March 2000. more than 300% since Saylor announced the first purchase of the company’s bitcoin in August. However, stocks tend to ride the incredibly volatile bitcoin price wave. In a filing last Monday, MicroStrategy said it expects to experience an impairment loss of at least $ 284.5 million in the second quarter based on fluctuations in the market price of bitcoin. Now down nearly 80% from their peak in the dot-com era, stocks have plunged more than 50% since February, when bitcoin sank after Tesla CEO Elon Musk said. that the prices seemed a bit high. The cryptocurrency has fallen by around 40% over the same period, but like MicroStrategy, its prices have increased by over 300% in the past year.
Surprising fact
As a sign of massive interest from institutional investors, MicroStrategy has reportedly received more than $ 1.5 billion in orders for the offer, which was announced two weeks ago as bitcoin prices were at an all-time low. for a month, about $ 33,400.
TANGENT
MicroStrategy has more bitcoin than any publicly traded company, but less than investment manager Grayscale, which has 654,885 tokens in its namesake bitcoin fund worth over $ 24 billion.
FURTHER READING
Major cryptocurrencies including Bitcoin, Ethereum, DogecoinPlumet as China expands crackdown (Forbes)
Biggest Bitcoin Corporate Investor Raises $ 500 Million To Buy More Expectations As Crypto Rises (Forbes)
Biggest Bitcoin Backer Expects $ 285 Million Loss After Crypto Crash, But Wants To Raise $ 400 Million In Debt To Buy More (Forbes)
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