MicroStrategy Purchases 15,350 BTC Increasing Total Holdings to 439,000 BTC
American business intelligence firm MicroStrategy Inc (NASDAQ: MSTR) continues its significant investment in Bitcoin (BTC), recently acquiring an additional 15,350 BTC for approximately $1.54 billion. This purchase reinforces its status as one of the largest corporate holders of Bitcoin.
MicroStrategy's Ongoing Bitcoin Acquisition
The acquisition, completed between December 9 and 15, involved purchasing Bitcoin at an average price of $100,386 each, bringing MicroStrategy’s total holdings to 439,000 BTC, valued over $45 billion. The total cost of these holdings is around $27.1 billion, with an average acquisition price of $61,725 per Bitcoin.
MicroStrategy has acquired 15,350 BTC for ~$1.5 billion at ~$100,386 per #bitcoin and has achieved BTC Yield of 46.4% QTD and 72.4% YTD. As of 12/15/2024, we hodl 439,000 $BTC acquired for ~$27.1 billion at ~$61,725 per bitcoin. $MSTR https://t.co/SaWLNBVkrl
— Michael Saylor⚡️ (@saylor) December 16, 2024
This acquisition marks six consecutive weeks of Bitcoin purchases, coinciding with Bitcoin reaching a record high of $106,352. MicroStrategy now holds about 2.1% of Bitcoin's total supply of 21 million. Funding for these purchases has primarily come from stock and debt issuance.
The company raises funds by selling shares and issuing convertible senior notes. As of December 15, it had approximately $7.65 billion worth of shares remaining to sell as part of a larger plan to raise $42 billion, aimed at expanding its Bitcoin holdings.
Despite concerns regarding its funding strategy, analysts at Bernstein express confidence in MicroStrategy's ability to sustain its aggressive acquisition approach. They anticipate that rising Bitcoin prices will stabilize the company's value, enabling better debt management and fundraising capacity.
Market Response
The market has reacted favorably to MicroStrategy's strategy, with the company's stock price surging over 490% in 2024 due to its Bitcoin investments. Its recent inclusion in the Nasdaq-100 index is expected to attract more institutional investors, potentially generating at least $2.1 billion in buying activity from ETFs tracking the index. This could pave the way for MicroStrategy's future entry into the S&P 500 Index.
However, the company faces challenges with its software business not generating consistent profits. Changes in Bitcoin valuation in 2025 may improve its financial outlook and eligibility for the S&P 500.
MicroStrategy's strategy emphasizes long-term growth over short-term gains, with expectations that Bitcoin could surpass traditional assets like gold and potentially reach $1 million per coin. Leadership remains committed to holding Bitcoin until this target is met, despite some investor skepticism.