Sarah Tran
Independent Analyst
- MicroStrategy stated that holding Bitcoin is generating substantial shareholder value.
- The publicly-listed firm raised more than $1 billion of additional capital in the first quarter to expand its BTC holdings.
- The business intelligence firm stated it may increase or decrease its assets in the future.
MicroStrategy announced its first-quarter financial results, reporting that it had one of the strongest operational quarters in years.
MicroStrategy continues to hold Bitcoin
The business intelligence firm reported earnings of $122.9 million, a 10.3% increase in the first quarter this year, compared to the same period in 2020.
The Nasdaq-listed firm has been acquiring large amounts of Bitcoin for its main treasury reserve since August 2020. MicroStrategy describes the initial purchase as a part of its “capital allocation strategy,” which was novel for a publicly-traded firm at the time.
The firm’s latest purchase of the leading cryptocurrency took place earlier this month, scooping up another $15 million in BTC. It now holds roughly 91,579 Bitcoin at an aggregate purchase price of $2.23 billion, at an average price of $24,311 per coin.
In its latest Q1 financial report, MicroStrategy CEO Michael J. Saylor said:
MicroStrategy’s first-quarter results were a clear example that our two-pronged corporate strategy to grow our enterprise analytics software business and acquire and hold bitcoin is generating substantial shareholder value.
MicroStrategy shares have also benefited from the firm’s cryptocurrency allocation. The MSTR stock has risen 405% since the start of the Bitcoin treasury program.
MicroStrategy stock performance since Bitcoin allocation
Saylor said he was pleased with the firm’s Bitcoin strategy, having raised over $1 billion of additional capital during the quarter to expand its cryptocurrency holdings. However, the financial report stated:
In future periods, MicroStrategy may purchase additional Bitcoins and increase its overall holdings of Bitcoin or sell its Bitcoins and decrease its overall holdings of Bitcoin.
This announcement potentially contradicts the CEO’s ongoing narrative of holding the Bitcoin long term. In particular, his statement in September 2020, “I didn’t buy it to sell it. Ever.” In Saylor’s recent tweet regarding MicroStrategy’s Q1 results, he said that the company continues to "hodl" all of the Bitcoin in its treasury.
Since Saylor announced the firm’s first-ever Bitcoin purchase, he has offered to share his experience with tech mogul Elon Musk on large crypto transactions. According to the MicroStrategy CEO, he believes that his tweets played a pivotal role in Tesla’s $1.5 billion investment in the pioneer cryptocurrency earlier this year.
Although Elon Musk recently revealed that he had not sold his Bitcoin, according to the latest financial report, his company Tesla sold around 10% of its BTC holdings to prove the cryptocurrency’s liquidity.
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended Content
Editors’ Picks
Is Altcoin Season here as Bitcoin reaches a new all-time high?
Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.
Shanghai court confirms legal recognition of crypto ownership
A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.
BTC hits an all-time high above $97,850, inches away from the $100K mark
Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange
Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.
Bitcoin: New high of $100K or correction to $78K?
Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.