MicroStrategy CEO and Co-founder, Michael Saylor, has announced that the company has purchased 7,002 BTC worth $414.4 million to add to its existing portfolio. According to a filing with the United States Securities and Exchange Commission (SEC), the total Bitcoin of 7,002 was purchased with cash, at an average price of approximately $59,187 per bitcoin, inclusive of fees and expenses.
MicroStrategy, a data analytics firm has been acquiring bitcoin for a while. The latest acquisition of 7,002 BTC brings the company’s total bitcoin portfolio to approximately 121,044 BTC making it the largest corporate bitcoin owner in the world. The total portfolio was acquired at an aggregregate purchase price of $3.57 billion and an average purchase price of approximately $29,534 per bitcoin.
The latest acquisition comes on the backdrop of price struggles with Bitcoin nearing a seven week low. This came after recent concerns over a newly identified coronavirus variant, dubbed omicron, affected the larger market. As of Monday morning, at a price of $57,000, bitcoin has plummeted nearly 18% from a record high of about $69,000 set earlier in November. Nevertheless the price is still up a staggering 94% over last year. Image: Bitcoins Price History
MicroStrategy has kept to its declaration of August 2020 in which it committed to adopt bitcoin as its treasury reserve asset. It stated that it considered the digital currency as a dependable store of value and an attractive investment with long term benefits. The company was able to facilitate its latest purchase from proceeds of stock sales previously disclosed in June. The company was able to raise approximately $414.4 million from the sale of 571,000 shares.
Thanks to its growing bitcoin investment—rivalled only by Tesla —MicroStrategy’s stock has skyrocketed more than 350% since the company started investing heavily in the digital currency in August 2020. On the flip side, it has also been incredibly sensitive to the crypto market’s outsized volatility.
Crypto’s wild price swings have only intensified this month, with the price of bitcoin falling to its lowest price since mid-October on Friday. After peaking at nearly $3 trillion in value on November 10, the crypto market now sits at a total market capitalization of less than $2.6 trillion.
Despite bitcoin’s explosive gains during the pandemic and adoption across various countries, many analysts are still not convinced the volatile asset has proven itself as a reliable store of value and inflationary hedge. Analysts believe that if the new coronavirus variant fuels additional stock-market losses, bitcoin prices could come under serious pressure.