MicroStrategy Adds 2,500 Bitcoin to Its Holdings

On the evening of December 28, investment firm MicroStrategy announced that it has resumed its Bitcoin purchasing activities after a prolonged hiatus.

From November 1 to December 24, 2022, MicroStrategy acquired an additional 2,500 BTC at a total cost of $44.6 million. In contrast, the company reported to the SEC that it sold $46.4 million worth of MSTR shares to investors, likely to offset the cost of the newly acquired BTC.

As of now, MicroStrategy holds a total of 132,500 BTC, valued at approximately $4.03 billion. However, with an average purchase price of $30,397 per Bitcoin, the company is currently facing a loss of over 45% on its investment.

This is the company's latest Bitcoin purchase since September 2022, when it added 301 BTC to its stash as part of its strategy to "round up" its holdings.

Historical Bitcoin purchases by MicroStrategy. Source: Saylor Tracker

Despite the severe downturn in the cryptocurrency market in 2022, with Bitcoin losing nearly 64% of its value, MicroStrategy remains steadfast in its long-term Bitcoin investment strategy. This commitment has remained unchanged even after the company reported a $918 million loss in Q2 2022, which led to founder Michael Saylor stepping down from his role as CEO to become Chairman.

In the latest transactions, the company disclosed that it purchased 2,395 BTC between November 1 and December 21, sold 704 BTC on December 22, and then repurchased 810 BTC on December 24. The reasons behind this buying and selling activity are unclear, especially given Bitcoin's relatively stable price during the Christmas period. However, the company has informed the SEC that it will account for the losses from BTC sales in its financial reports for tax deduction purposes.

4-hour chart of BTC/USDT on Binance as of 08:25 PM on December 28, 2022

There are reports suggesting that had MicroStrategy invested in ETH instead of BTC, it might have doubled its investment rather than facing losses.