MicroStrategy has been incredible with its bitcoin buying as it recently spent over $29 million on over 1,000 BTC.
micro strategy (NASDAQ: MSTR) continued to collect more bitcoin and bought an additional 1,045 BTC. The business intelligence firm announced that it recently spent $29.3 million on purchases, averaging $28,016 per bitcoin. according to a do from co-founder and executive chairman Michael SaylorMicroStrategy now has 140,000 bitcoins in its portfolio. The company spent a total of $4.17 billion at an average of $29,803 per coin.
The US intelligence company has been buying bitcoins for a few years. Its first purchase was in August 2020, when it spent around $250 million on 21,000 bitcoins. At the time, MicroStrategy made headlines as one of the first public companies to hold crypto as a store of value after transferring funds from its coffers.
MicroStrategy bought more bitcoin last week to pay off Silvergate debt
In March, MicroStrategy announced that it bought 6,455 bitcoins, spending $150 million on the transaction. The company said it bought bitcoins at an average of $23,238 per coin over five weeks. At the time, the company had a total portfolio of around 139,000 bitcoins.
In addition to buying more bitcoin, MicroStrategy announced it paid off a loan from collapsed crypto-focused Silvergate Bank. according to a seconds In the filing, the company repaid a total of $161 million of the $205 million loan. Following the payment, MicroStrategy received 34,619 bitcoins placed as collateral for the transaction initiated in March last year. The intelligence firm confirmed that it paid off the loan after raising $339.4 million from selling MSTR shares.
MicroStrategy decided to repay the loan even though the payments are not due until the first quarter of 2025. According to the company, no BTC was held in custody with Silvergate, even though the loans used bitcoin as collateral. This reassured MicroStrategy shareholders that even after Silvergate went bankrupt, MicroStrategy’s bitcoin collateral was safe. The firm allayed apprehensions in March as well doadding that apart from the loan, the two companies have “no other financial relationship”.
Microstrategy and bitcoin
MicroStrategy has been bullish on bitcoin for a long time. The Company has continued to purchase King Coin even during the Biting Bear market. However, MicroStrategy recently took a small loss after selling some of its bitcoin.
MSTR reached its lowest level since August 2020 in December following the selloff of bitcoin. This first sale saw MicroStrategy offload 704 bitcoins For about $11.8 million. The company said it sold the bitcoins for tax reasons and confirmed it had bought 810 bitcoins two days later. However, MSTR fell 1.1% to $136.63 following the announcement. At that point, the stock was down 75% year-to-date (YTD).
MicroStrategy’s continued bitcoin purchases have worried many investors. Some investors are nervous, according to Matt Malley, chief market strategist at Miller Tabak + Company. Maley said investors expected Microstrategy to “reduce their holdings” following Salor’s decision to step down as CEO.
According to Brent Thill, an analyst at Jefferies, MicroStrategy may face some problems soon. Thill has said that the company may soon struggle with liquidity as it has too much leverage for bitcoin in its current state.
Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to strip crypto stories down to the basics so that anyone anywhere can understand without a lot of background knowledge. When he is not delving deep into crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
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