Largest Bitcoin Purchase Since 2021: MicroStrategy Acquires $1.1 Billion
MicroStrategy Inc. has made a significant move in the cryptocurrency space by acquiring 18,300 Bitcoin for approximately $1.11 billion, marking its largest purchase of the digital asset in over three years. This purchase was revealed in a recent filing with the US Securities and Exchange Commission. The enterprise software company has been actively involved in buying Bitcoin as part of its corporate strategy, with this latest acquisition taking place between August 6 and September 12. This acquisition surpasses its previous largest purchase of 19,452 Bitcoin announced in February 2021.
Currently, MicroStrategy holds approximately 244,800 Bitcoin, which is valued at around $14 billion, constituting about 1% of all Bitcoin ever issued. In comparison, BlackRock’s iShares Bitcoin Trust stands as the world’s largest Bitcoin fund with a value of about $20 billion. MicroStrategy has acquired its Bitcoin at an aggregate purchase price of about $9.45 billion, with an average purchase price of roughly $38,585. The price of Bitcoin remained relatively stable around $57,880 at the time of the announcement.
The decision to invest in Bitcoin stems from MicroStrategy’s capital allocation strategy, with co-founder and chairman Michael Saylor highlighting the importance of hedging against inflation. While Saylor has garnered praise from Bitcoin supporters for this move, only a few US public companies, including Tesla Inc. and some crypto-related firms, have opted to hold the volatile cryptocurrency on their balance sheets.
To finance these recent acquisitions, MicroStrategy utilized proceeds from the issuance and sale of common shares. In August, the company executed a 10-for-1 stock split to enhance accessibility for investors and employees. This strategic move has proven successful for MicroStrategy, as its shares have more than doubled in value this year, outperforming Bitcoin’s price increase of around 40% during the same period.
In conclusion, MicroStrategy’s latest Bitcoin purchase underscores its commitment to digital assets as part of its long-term financial strategy. The company’s proactive approach to cryptocurrency investment has positioned it as a significant player in the evolving landscape of digital finance.
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