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MicroStrategy valuation to $240M on purchase of additional 5,050 BTC

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Rushali Das Follow


Sep, 15 2021

Sep, 15 2021

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MicroStrategy Inc, the world’s largest Bitcoin (BTC) holding company, announced that it had purchased an additional 5,050 bitcoins for $240 million on September 13.

On Monday, bitcoin, the world’s largest crypto, was trading about 3% lower at $ 44,833.70. MicroStrategy, a US-based business intelligence, mobile software, and cloud-based service company, was founded in 1989.

“MicroStrategy has purchased an additional 5,050 bitcoins for ? $242.9 million in cash at an average price of ? $48,099 per #bitcoin. As of 9/12/21 we #hodl ? 114,042 bitcoins acquired for ? $3.16 billion at an average price of ? $27,713 per bitcoin. $MSTR,” MicroStrategy founder and CEO Michael Saylor announced the latest bitcoin purchase via Twitter.

According to the executive, MicroStrategy now owns 114,042 bitcoins. They acquired these for $ 3.16 billion at an average price of $ 27,713 per bitcoin. The business intelligence firm had announced a regulatory filing that they had bought around 8,957 bitcoins for approximately $ 419.9 million in cash, at an average price of $ 48,099 per bitcoin, including fees and expenses between July 1 and September 12.

The company had then also announced that it had sold approximately 5,55,179 shares for $ 399.9 million. This was a part of its previously announced plan, which focused on selling up to $ 1.0 billion of its shares. MicroStrategy is one of the early adopters of the world’s oldest and most prominent cryptocurrency. In August 2020, the firm claimed that it was using existing cash to acquire cryptocurrency.

According to reports, the company had faced losses of $ 689.6 million due to holding digital assets on its books in its May-June quarterly results. Still, in July, the company wanted to continue buying bitcoin.

The US electric car maker, Tesla Inc, is the world’s largest bitcoin holder after MicroStrategy. Tesla claimed that it had $ 1.3 billion worth of bitcoins on its balance sheet in its June quarter results.

After the news broke out, Willy Woo, the famous bitcoin on-chain analyst, published a chart showing bitcoin held by public companies. This chart indicates MicroStrategy leading the graph, followed by Tesla, Galaxy Digital, and Jack Dorsey’s payments company Square. Woo also shared his thoughts through a tweet stating that he believes many companies use MicroStrategy to get exposure to bitcoin without buying it themselves.

The analyst wrote, “In case people wonder why MicroStrategy is such a large holder. I think public companies find it easier to buy a convertible debt instrument from MicroStrategy to gain BTC exposure than to hold the underlying asset. IMO MicroStrategy holds BTC for many companies.” 

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Rushali Das

CBW - External Analyst


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