Key Points
- MicroStrategy Inc. has purchased an additional 15,350 Bitcoin (BTC), bringing its total holdings to 439,000 BTC.
- The firm’s aggressive acquisition strategy is geared towards long-term growth, despite concerns over its use of debt and stock sales to fund purchases.
MicroStrategy Inc., an American business intelligence and software company, has made news once again with its substantial investment in Bitcoin (BTC). The company has recently acquired an extra 15,350 BTC for approximately $1.54 billion, setting a new record in its buying spree.
This move solidifies its position as one of the largest corporate holders of Bitcoin. The purchase is part of a series of major Bitcoin investments that underscore the company’s unwavering commitment to its long-term strategy.
MicroStrategy’s Bitcoin Accumulation
The latest acquisition by MicroStrategy took place between December 9 and 15, with the firm purchasing Bitcoin at an average price of $100,386 each.
The company’s total Bitcoin holdings now amount to an impressive 439,000 BTC, valued at over $45 billion. The total cost of these holdings is around $27.1 billion, acquired at an average price of $61,725 per Bitcoin.
This particular purchase is notable not only for its size but also because it marks the company’s sixth consecutive week of Bitcoin acquisitions. This is seen as a positive bet, especially since the price of Bitcoin recently reached an all-time high of $106,352.
MicroStrategy’s Bitcoin holdings now account for about 2.1% of Bitcoin’s total 21 million supply. Over time, MicroStrategy has used stock and debt to fund these Bitcoin purchases.
The company frequently raises funds by selling its shares and issuing convertible senior notes in a private offering. By December 15, it still had around $7.65 billion worth of shares left to sell as part of a larger plan to raise $42 billion. This strategy is integral to MicroStrategy’s plan to continue expanding its Bitcoin holdings.
Despite investor worries about MicroStrategy’s use of debt and stock sales for Bitcoin purchases, Bernstein analysts remain confident in the company’s ability to sustain its aggressive acquisition strategy.
Their forecast indicates that as Bitcoin’s price rises, MicroStrategy’s value will stabilize, allowing the company to manage its debt and raise more money.
Market Response
The market has responded favorably to MicroStrategy’s strategy. In 2024, MicroStrategy’s stock price has seen a remarkable increase of over 490%, driven by its Bitcoin strategy. The company’s recent addition to the Nasdaq-100 index has added to this momentum, suggesting that more institutional investors are likely to buy MicroStrategy shares.
Analysts predict that the company could attract at least $2.1 billion in buying activity from exchange-traded funds (ETFs) that track the index. This achievement also opens up the possibility for MicroStrategy to join the S&P 500 Index in the future, which could further bolster its market position.
However, the company currently faces a significant challenge in that its software business is not consistently profitable. Nevertheless, a change in how Bitcoin is valued in 2025 could improve the company’s finances and make it eligible for the S&P 500.
MicroStrategy’s aggressive Bitcoin acquisition strategy is not about quick profits; it is focused on the long term. The company believes Bitcoin will be more valuable than traditional assets like gold and predicts it might top $1 million per coin.
Although some investors remain cautious about this bold plan, MicroStrategy’s leadership is committed to holding onto Bitcoin until it reaches that goal.
