MicroStrategy has announced another approximately $1 billion investment in bitcoin.
The CEO Michael Saylor wrote on Twitter:
“MicroStrategy has purchased an additional ~19,452 bitcoins for ~$1.026 billion in cash at an average price of ~$52,765 per bitcoin”.
MicroStrategy has purchased an additional ~19,452 bitcoins for ~$1.026 billion in cash at an average price of ~$52,765 per #bitcoin. As of 2/24/2021, we #hodl ~90,531 bitcoins acquired for ~$2.171 billion at an average price of ~$23,985 per bitcoin. $MSTRhttps://t.co/FbsRYhXEhn
— Michael Saylor (@michael_saylor) February 24, 2021
He also revealed that the company now holds about 90,531 BTC, acquired with a spending of $2.171 billion, at an average price of about $23,985 per bitcoin.
Currently, those 90,531 BTC have a market value of over $4.4 billion, and given that the investment was $2.17 billion, current capital gains are around 102%.
MicroStrategy’s first purchases of Bitcoin were made in August, at an average price of around $11,600, so they have already made more than 300%.
Evidently, these purchases were made last week, or at the very latest overnight between yesterday and Sunday, because if they had waited a few more hours they would have been able to buy at a price below $50,000.
While the decision to buy more BTC at these prices, which are only 12% below the all-time high of around $58,000, may come as a surprise, the incredible gains already made actually reduce the risk, because when all the BTC purchased are added together, their value is still well above the total purchase price.
MicroStrategy bullish on Bitcoin
Furthermore, this decision seems to suggest a further bullish view on the price of bitcoin on the part of both Square and MicroStrategy, so much so that they are not intimidated to buy at this time at these prices, but rather increase their BTC exposure.
This could be a gamble, but given what has already happened, it could also just be an increase in exposure to an asset that has already benefited them.
It should be noted, however, that while this morning the price of BTC seemed to have benefited from the news of Square’s purchase, this afternoon the news of MicroStrategy’s new purchase does not seem to have had much effect.