Investing $1.1 billion, Bitcoin "big player" MicroStrategy makes its biggest move in three years

Wallstreetcn
2024.09.13 22:33
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As of this Thursday, in just over five weeks, MicroStrategy has invested approximately $1.1 billion to purchase 18,300 bitcoins, holding a total of about 244,800 bitcoins, accounting for about 1% of the total issuance. The market value of the holding exceeds $14 billion. The market value of the world's largest bitcoin spot ETF is only about $20 billion

The world's largest publicly traded company holding Bitcoin, MicroStrategy Inc., is adding more.

According to the SEC filing announced on Friday, September 13th, Eastern Time, MicroStrategy has invested approximately $1.11 billion from August 6th to Thursday, September 12th, buying a total of 18,300 Bitcoins in a little over five weeks, marking the largest increase in holdings in over three years. The last time such a large increase was made was in February 2021 when the company spent $1.026 billion to acquire 19,452 Bitcoins.

As of this Friday's disclosure of the latest additional purchases, MicroStrategy holds approximately 244,800 Bitcoins, accounting for about 1% of the total Bitcoin supply. Based on the trading price above $59,700 for Bitcoin at the close of the US stock market according to CoinMarketCap, MicroStrategy's Bitcoin holdings are valued at approximately $14.6 billion. In comparison, the iShares Bitcoin Trust issued by BlackRock is valued at only about $20 billion. This means that the holdings of a single company like MicroStrategy are equivalent to over 70% of the world's largest Bitcoin spot ETF.

The filing on Friday shows that the cumulative purchase price for the over 240,000 Bitcoins bought by MicroStrategy is approximately $9.45 billion, with an average purchase price per Bitcoin of around $38,585. With the current market price, it is indeed a substantial investment.

On Friday, Bitcoin accelerated its rise after the US stock market opened, breaking through $59,000 at midday, and continued to rise after the US stock market closed, breaking through the $60,000 mark intraday for the first time since the end of August, with the increase exceeding 10% in the past 24 hours.

MicroStrategy has been buying Bitcoin as part of its capital allocation strategy since 2020. Michael Saylor, the company's co-founder and chairman, stated that holding Bitcoin is a hedge against inflation. Saylor revealed on social media X on Friday that MicroStrategy's Bitcoin yield for the year has reached 17%. This figure means that by selling stocks and buying Bitcoin, the company has created an additional value increase of 17% for its shareholders.

Saylor earlier told CNBC this week that MicroStrategy is essentially providing people with different types of Bitcoin investment opportunities. The company's mission is to securitize Bitcoin and act as a bridge between traditional mainstream investors and Bitcoin for institutions

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