MicroStrategy continues to load up on Bitcoin, announcing the acquisition of 16,130 more Bitcoin worth nearly $593.3 million. The move extends CEO Michael Saylor’s controversial crypto accumulation strategy, which now sits on unrealized profits exceeding $1 billion.
MicroStrategy has purchased 174,500 BTC for $3.85 billion since 2020. That enormous position equates to $6 billion at press time valuations.
Saylor has essentially transformed MicroStrategy into a leveraged Bitcoin exchange-traded fund through persistent debt offerings, converting cash flows into crypto assets. That dependency intensified this summer by pledging 105,000 Bitcoin as collateral, allowing MicroStrategy to take on $1.6 billion in extra convertible debt.
The bold bet backfired as Bitcoin cratered in 2022, forcing MicroStrategy to inject capital towards margin calls as its crypto hoard dipped 70% into the red. But prices rebounding to six-month highs near $17,000 now put Saylor around $1 billion ahead.
MicroStrategy keeps accumulating Bitcoin
With characteristic confidence in further upside, MicroStrategy bought another stash equal to around 1% of the circulating Bitcoin supply using excess corporate cash. Saylor affirmed his ideological view that digital gold offers superior long-term wealth preservation and upside compared to fiat alternatives.
Saylor continues to evangelize Bitcoin’s monetary evolution and its role in protecting shareholder interests against what he views as inevitable currency debasement.
Whether vision or delusion, the fact remains that MicroStrategy’s immediate fortunes greatly depend on Bitcoin prices appreciating substantially higher. Its towering crypto exposure literally “bet the company” on an emerging asset class facing existential threats from regulation and competition.
Source: Read Full Article