Microstrategy has made a new bitcoin purchase. Founder and CEO Michael Saylor announced it on Twitter.
MicroStrategy has purchased an additional 271 bitcoins for $15.0 million in cash at an average price of ~$55,387 per #bitcoin. As of 5/13/2021, we #hodl ~91,850 bitcoins acquired for ~$2.241 billion at an average price of ~24,403 per bitcoin. $MSTRhttps://t.co/EwZnRkAt6k
— Michael Saylor (@michael_saylor) May 13, 2021
This time the company purchased 271 BTC at an average price of $55.387 per bitcoin, investing an additional $15 million.
Now, as of 13 May 2021, it owns about 91,850 BTC, with a current value of almost $4.5 billion, purchased with an investment of $2.241 billion at an average price of about $24,403. The current market price is around $49,000.
Thus, Microstrategy’s investment in bitcoin to date has virtually doubled in value, nine months after its first purchase in August 2020.
The fact that this latest purchase was made at a price above $55,000 reveals on the one hand that it was made after the 12 May drop that took BTC well below this threshold, but also reveals that the company probably expects further rises in the coming weeks, or months.
It should be noted that Microstrategy had also made a similar purchase at the beginning of April, about a month ago, when it invested another $15 million, but at an average price of $59,339 per bitcoin, which is significantly higher than the current price. It should be added, however, that a few days later, on 14 April, the price of bitcoin shot up to its all-time high of almost $65,000.
Microstrategy’s bitcoin buying strategy
The first purchases were made in August 2020 when the price was still under $12,000, more than four times lower than it is today.
It is curious how the company, despite the huge gains it has already made with this type of investment, continues to buy BTC, so much so that it now has close to $4.5 billion worth of it on its balance sheet.
It may be that this strategy is also due to the continuing news that the US dollar is much more inflationary than expected this year, with a loss of purchasing power now well in excess of 4%, more than double the average threshold that is commonly considered desirable over the long term.
Microstrategy is a cash-rich company, and last year decided to hold its cash in bitcoin instead of dollars. So far, this has proven to be a successful decision.