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MicroStrategy acquires 1% of global bitcoin holdings

AuthorJoshua Downes
Editor
Fact Checked by Wajeeh Khan
Last updated: March 20, 2024
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MicroStrategy's Significant Bitcoin Holdings Acquisition

In the month of August in 2020, MicroStrategy made its initial acquisition of bitcoin by purchasing 21,454 bitcoins for a total of $250 million.

After a period of three and a half years, the organization currently possesses more than 1% of the total bitcoin that has been acquired through mining.

According to a filing with the SEC, MicroStrategy has been consistently increasing their holdings of the digital token since their initial purchase. In the period between March 11 and March 18, the company acquired an additional 9,245 tokens at a cost of $623 million.

With the addition of 214,246 tokens, the total stash of the company now stands at just over 1% of the approximately 19.7 million tokens that have been issued thus far.

The surge in MicroStrategy’s interest in cryptocurrency has been attributed to the company’s co-founder, Michael Saylor. Saylor, a staunch supporter of bitcoin for many years, has recently made the bold statement that cryptocurrency will overpower gold, the asset that it is frequently compared to.

The investments made by him have proven to be successful, as bitcoin has experienced a significant surge in the past 12 months. MicroStrategy’s shares have increased by approximately 380% in the previous year, while bitcoin has seen a rise of over 150% during the same period.

I would encourage people to think of [Bitcoin] as digital property – a billion-dollar building in cyberspace. Hold it for 100 years.

Michael Saylor

According to a report by Bloomberg, in the year 2024, MicroStrategy has already acquired almost a quarter of all its bitcoin holdings, representing a significant increase in its previous purchases.

The original bitcoin white paper by Satoshi Nakamoto states that the maximum number of bitcoins that can be mined is 21 million. This limit is projected to be reached in 2140, as every four years, the reward for miners who add new tokens to the blockchain is cut in half.

In April, the upcoming halving event will result in a reduction of the reward to 3.125 bitcoin.

According to sources, the current surge in value can be attributed in part to this year’s halving. This trend has been observed in the past three halving events,which have all resulted in record-breaking highs within the following 12 months.

According to the SEC filing, MicroStrategy’s most recent purchase saw an average bitcoin price of $67,382. This brings the average purchase price of their entire holding, valued at $13.46 billion, to $35,160.

Will MicroStrategy sell?

However, according to Michael Saylor, the company has no plans to sell any of its Bitcoin investments in the near future.

The company’s software business remains profitable and is providing a steady cash flow for further Bitcoin acquisitions.

MicroStrategy believes that its strategic investment in Bitcoin will ultimately benefit its shareholders through long-term gains and increased value per share.

MicroStrategy’s significant investment in Bitcoin with this latest acquisition underscores the growing recognition of the cryptocurrency as a legitimate competitor to established store-of-value assets among institutional investors.

Despite the volatile nature and uncertain future of Bitcoin, MicroStrategy’s steadfast dedication to its strategic investment approach serves as a testament to its conviction that this groundbreaking digital currency holds immense promise as a revolutionary force in the global financial landscape.

About MicroStrategy

Established in 1989 by Michael J. Saylor, MicroStrategy stands as a pioneer in enterprise business intelligence (BI) software. Its flagship platform boasts an array of features tailored to facilitate data-driven decision-making and streamline business operations.

From interactive dashboards to ad hoc queries and automated report distribution, MicroStrategy equips enterprises with versatile tools for analysis and optimization. Notably, the company distinguishes itself by developing its entire product line in-house, maintaining its independence in the market.

Furthermore, in the early 2020s, MicroStrategy made headlines with its strategic move to invest heavily in Bitcoin. This unconventional approach not only attracted considerable media attention but also played a pivotal role in the company’s recovery from the setbacks it faced during the dot-com crash of the late 1990s and early 2000s.

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