MicroStrategy piles on Bitcoin, acquiring 0.90% of circulating supply

MicroStrategy, the world’s largest Bitcoin corporate holder, has further increased its holdings of the primary cryptocurrency. According to a recent filing, the company acquired an additional 16,130 bitcoins between November 1 and November 29, spending $593.3 million at an average price of $36,785 per bitcoin.

Michael Saylor, the Founder and Chairman of MicroStrategy, shared in a social media post that the company now holds a total of 174,540 bitcoins.

In addition to expanding its Bitcoin portfolio, MicroStrategy also announced plans to raise more funds. The company is considering the sale of new Class A common stock shares, aiming to raise up to $750 million.

The business software company has seen unrealized gains of over $1.1 billion on its Bitcoin holdings, eclipsing their cumulative investment by 25%. As Bitcoin’s price crossed the $38,000 mark for the first time since May 2022, MicroStrategy’s investment resulted in impressive profits. Holding 174,530 BTC, the Virginia-based business intelligence firm has invested $5.28 billion, amounting to about 1% of Bitcoin’s circulating supply.

The company’s average purchase price per coin, based on its most recent acquisition in November, was $30,252, resulting in a gain of around 24% per coin at the current Bitcoin price of $37,700.

MicroStrategy’s foray into Bitcoin has not only led to substantial cryptocurrency gains but has also boosted its stock performance, with shares rising by 215% this year. Executive Chairman Michael Saylor has reiterated his belief in Bitcoin’s role as a revolutionary monetary network and a reliable hedge against inflation.

Meanwhile, the company reported a $125.8 million impairment loss on its Bitcoin holdings. This was due to the market price of Bitcoin being lower than its carrying value as of September 30, 2023. MicroStrategy remains the largest public Bitcoin holder, followed by firms like Tesla and Marathon Digital Holdings.

MicroStrategy has been known for its aggressive Bitcoin acquisition strategy, and this quarter was no exception. This extensive hoard of the primary cryptocurrency witnessed a bleak phase in 2022 when Bitcoin plummeted 80% from its peak in November 2021. However, the rumors around the approval of a Bitcoin ETF and the impending halving event acted as the needed tailwinds, nearly doubling the digital currency’s price this year. Specifically, MicroStrategy has reported a “paper gain” of $900 million on its 158,400 Bitcoin holdings.