MicroStrategy acquires $147 million worth of Bitcoin in two months, still bearing a 12% loss

• MicroStrategy founder Michael Saylor announced the company bought 5,445 BTC between August 1 and September 24.
• The company holds 158,245 BTC purchased at a value of $4.68 billion, which is now worth $4.12 billion.
• The Q2 2023 earning reports noted BTC brought on $24 million in impairment losses, while MSTR declined 30% from its peak in July.

The crypto market has been struggling to recover from the bearishness witnessed in August. However, MicroStrategy is making the most of the situation. The Michael Saylor company acquired more Bitcoins during the August crash, adding to its overall BTC holdings, and the losses amounted to it.

MicroStrategy purchases more Bitcoin

MicroStrategy, the company that is known mostly for its bold decision to build its future on the back of Bitcoin, added more BTC to its holdings. On September 25, founder Michael Saylor shared an X post announcing that the company purchased another 5,445 BTC between August 1 and September 24 at an aggregate value of $147.3 million.

This purchase, along with the previous acquisition of 12,333 BTC ($347 million) in June, brings the total BTC held by the software company to 158,245. The purchase value of all these BTCs combined is over $4.68 billion; however, their value at the present market price of the cryptocurrency is around $4.12 billion. This marks a 12% drawdown from the purchase to market price, suggesting the company is still at a loss.

The chances of all 158,245 BTC achieving a profit or break-even status would be when Bitcoin price hits $29,582. This warrants a 13% increase in price as BTC is currently trading at $26,116.

Last month, MicroStrategy released its Q2 2023 earnings report. This report highlighted that the operating expenses include impairment losses on the company’s digital assets amounting to $24 million. The losses marked a severe decline from the second quarter of 2022 when MicroStrategy reported $917 million worth of impairment losses.

Market conditions harm MicroStrategy more than Bitcoin

While MicroStrategy has been building its future on the back of Bitcoin, its value is still derived from the stock market movement. The company’s share price in Q2 rose to the year-to-date peak of $462.30 but ended up crashing to $318 at the time of writing. This 30% decline is far larger than the 17% drawdown noted by Bitcoin price in the same period. 

BTC/USD 1-day chart

However, MicroStrategy’s move might benefit Bitcoin price, which is looking at an increase over the coming days. The recent liquidity purge is suggesting a rise towards $27,423 and beyond. Furthermore, Michael Saylor’s MicroStrategy’s recent move will feed this bullishness to push the cryptocurrency’s price higher.

Read more - Bitcoin price action culls $30 million longs ahead of Fed Chairman speech

 

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