Bitcoin’s surge to around $37,900 on Thursday has turned MicroStrategy’s multibillion-dollar bet on the flagship cryptocurrency into a massive profit of more than $1 billion.
Bitcoin’s recent price surge marks a remarkable turnaround following a turbulent period in the cryptocurrency market. Last November, it plummeted to approximately $15,600 following the collapse of Terra’s algorithmic UST stablecoin, which had a domino effect on various cryptocurrency firms, including FTX, Three Arrows Capital and Celsius.
This year’s remarkable recovery of Bitcoin, with a year-to-date gain of just over 100%, is primarily attributed to growing optimism surrounding the potential approval of a spot Bitcoin exchange-traded fund (ETF) as ballooning inflation. This price surge has translated into substantial gains for MicroStrategy, one of the most prominent corporate holders of Bitcoin.
According to data from “Saylor Tracker”, a platform that records Microstrategy’s Bitcoin acquisitions, the company’s holdings had accrued a substantial paper profit of approximately $1.08 billion as of November 10.
Notably, the firm, the largest public holder of Bitcoin, currently holds a total of 158,400 BTC for $4.73 billion. This means that MicroStrategy now commands approximately 0.75% of Bitcoin’s circulating supply.
Moreover, as of their most recent Bitcoin acquisition on October 31, MicroStrategy placed the average purchase price per coin at $29,874. With Bitcoin trading at $36,980 at press time, this reflects an impressive 19.29% gain on each of its coins.
Meanwhile, MicroStrategy’s foray into Bitcoin has not only resulted in substantial cryptocurrency gains but has also significantly bolstered its stock performance, with shares soaring by approximately 215% over this year.
Michael Saylor, the outspoken Executive Chair of MicroStrategy, has recently reiterated his belief in the cryptocurrency’s role as a revolutionary monetary network, emphasizing that it’s a superior long-term investment and a reliable hedge against inflation.
“Bitcoin offers corporations an innovative strategy to preserve their capital and create shareholder value by leveraging their balance sheets with $BTC, providing an escape from the destructive cycle of expensive acquisitions, buybacks, dividends, & debt.” Saylor told CNBC last Saturday.
Previously, Saylor has also emphasized the company’s resolve to continue accumulating and holding Bitcoin, including through the sale of company stock to fund BTC purchases.
That said, despite MicroStrategy’s investment in Bitcoin proving to be a financial rollercoaster, the latest price surge has propelled its holdings into impressive profitability, with the future looking bright for the top cryptocurrency amid continued institutional backing.