Tag: MicroStrategy

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Bitcoin Crypto News

MicroStrategy Buys Additional $1 Billion Worth of Bitcoin

Bitcoin Outperformed Oil, Gold With Over 100% Increase in Q1 2021

Just recently, MicroStrategy was rumored to have bought Bitcoin, as lots of BTC were being moved from Coinbase to an unknown wallet. The company was suspected of making the transactions because it recently raised capital to buy more Bitcoin, and Coinbase has been its go-to exchange for purchases. The report has been confirmed, following an announcement on Wednesday that MicroStrategy purchased over $1 billion worth of Bitcoin.

For the record, this is the single largest purchase it has ever made. Of course, the company remains the largest corporate Bitcoin investor, followed by Elon Musk’s Tesla.

MicroStrategy now Holds Over 90,000 BTC

As reported, MicroStrategy purchase about 19,452 BTC at an average price of US$52,765 per coin. In total, the aggregate cost of the cryptocurrencies was US$1.026 billion, which also covers the expenses and transaction fees. Such a massive purchase shows the level of confidence Michael Saylor, the CEO of MicroStrategy, and the rest of the executives, have in the cryptocurrency as a store of value.

Overall, the company currently holds 90,531 BTC in its balance sheet, all of which were purchased at the aggregate cost of US$2.171 billion. This means that each coin was purchased at the average price of US$23,985. As it stands, the company is obviously not going to sell these cryptocurrencies any time soon. In fact, MicroStrategy plans to hold more Bitcoin as part of its corporate strategy. 

Corporate Investors are Taking Over

“The company now holds over 90,000 bitcoins, reaffirming our belief that bitcoin, as the world’s most widely-adopted cryptocurrency, can serve as a dependable store of value,” Saylor noted in the report. “We will continue to pursue our strategy of acquiring bitcoin with excess cash, and we may, from time to time, subject to market conditions, issue debt or equity securities in capital raising transactions with the objective of using the proceeds to purchase additional bitcoin.” 

Early Wednesday, Jack Dorsey’s Square Inc. also announced they bought an additional US$170 million worth of Bitcoin. We can only expect more Bitcoin purchases from companies at this point.

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Bitcoin Coinbase Institutions

Bitcoin Whale Moves AU$1 Billion of BTC into Storage

According to the popular blockchain tracking and analysis service Whale Alert, a user has moved 13,204 BTC worth nearly AU$1 billion out of Coinbase and into an ‘unknown wallet’. This typically indicates a wealthy individual or large institution buying Bitcoin and moving it into ‘cold storage’ such as a hard wallet for safekeeping.

The transactions happened over a one-hour period and involved 34 individual transactions of around 380 BTC each worth approximately US$21 million each. The choice of number could be a reference to Bitcoin’s 21 million supply cap but it’s probably just coincidental.

Naturally, the moves attracted attention, with several Twitter comments questioning whether this could be another big buy from Michael Saylor’s Microstrategy investment firm. However, these moves all occurred during a Sunday, which would be odd for a company or traditional financial institution.

Big BTC Moves

Although this recent transfer amounts to a considerable amount of cash, it’s relatively small compared to some previous big moves. Last year in June, just after Bitcoin’s 3rd halvening, a whale moved 132,255 BTC in three separate transfers, amounting to US$1.3 billion at the time.

In the number of actual coins moved, even that amount remains comparatively small. Way back in 2011, a single transaction was completed involving 550,000 BTC, worth a whopping US$30.8 billion today but a meager US$1.3 million at the time.

Bitcoin Continues to Push Higher

Large moves such as these indicate big players entering the market and placing their coins in longterm storage with the expectation of further growth. If an individual or company with that much money has such strong faith in Bitcoin then one can only assume a fair amount of research has gone into their decision.

Just this year alone, both Bitcoin’s individual market cap and the wider cryptocurrency market cap have almost doubled in value. Bitcoin recently crossed the significant $1 trillion mark, climbing from US$530 million on December 31st, 2020.

The price of one BTC hit a new all-time high of above US$58,600 yesterday before suffering a mild rejection that has taken it back down to US$56,000. However, the price remains above the upward trend line and has already begun to make a decent recovery.

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Bitcoin Institutions

MicroStrategy Adds More 2,574 Bitcoin to its Crypto Reserve

MicroStrategy Adds More 2,574 Bitcoin to its Crypto Reserve

Publicly-traded business intelligence company MicroStrategy has purchased an additional US$50 million Bitcoin (BTC), according to the CEO, Michael Saylor. The recent purchase further strengthens the company’s stand as the largest company holding the cryptocurrency as a reserve asset. By investing in Bitcoin, the company sees it as a better inflation-hedge asset against cash, including Gold. 

Many other companies like Square have joined the train, adding a massive amount of Bitcoin to their reserve.

MicroStrategy now Holds Over 40,000 Bitcoin

The US$50 million Bitcoin purchase was also confirmed in the company’s recent filing with the United States Security and Exchange Commission (SEC). At such an amount, MicroStrategy could buy 2,574 Bitcoin at the average price of $19,427 yesterday. This is the third time MicroStrategy is acquiring Bitcoin. In August, the business intelligence firm purchased the first whopping amount of 21,454 BTC for US$250 million at the average price of $11,635.

About one month later, MicroStrategy announced an additional 16,796 BTC for $175 million. Overall, the company now has about 40,824 Bitcoin as cryptocurrency reserve. At today’s price of US$18,866 on Coinmarketcap, MicroStrategy’s Bitcoin treasury is worth over US770 million. Such a massive number of Bitcoin indicates the level of confidence the company and its board members have in the leading cryptocurrency. While giving reasons for the crypto treasury, MicroStrategy explained that:

“If you have large dollar values and you’re hoping for any kind of return on them, that’s faded. Gold, silver, and bitcoin are showing strength. […] Hence, if we look at assets, gold, silver, bitcoin, and equities have all been accreting as the dollar has been weakening.”

Corporate Bitcoin Investors

MicroStrategy’s move into Bitcoin had caused many companies to rethink allocating a portion of their reserve in the cryptocurrency. On this train is Square Inc., which purchased about US$50 million worth of Bitcoin. Among others, Galaxy Digital Holdings also has about US$130 million worth of Bitcoin in its reserve.