MicroStrategy Acquires Bitcoins Worth $615.7 Million Amidst Spot Bitcoin ETF Anticipation
In Brief
MicroStrategy acquired 14,620 Bitcoins worth $615.7 million in cash amid rising expectations of spot Bitcoin ETF approval in January 2024.
Software firm MicroStrategy acquired Bitcoins worth approximately $615.7 million in cash. The company, along with its subsidiaries, purchased around 14,620 Bitcoins at an average cost of approximately $42,110 from November 30 to December 26, according to regulatory filings.
“Due to its limited supply, Bitcoin offers the opportunity for appreciation in value if its adoption increases and has the potential to serve as a hedge against inflation in the long term.”
MicroStrategy stated in its latest quarterly report.
The company began buying the cryptocurrency in 2020, along with its subsidiaries and now holds approximately 189,150 Bitcoins, acquired at a cost of about $5.9 billion. MicroStrategy emphasizes that its Bitcoin investments are intended for long-term holdings, expressing its intention to continue accumulating the world’s largest and most well-known cryptocurrency.
MicroStrategy’s decision to invest in Bitcoin to protect the value of its reserve assets contributed to the increased attractiveness of the company’s stock, which typically correlates with the performance of the digital asset. The MicroStrategy shares experienced an 8% surge after the news came out. The company has witnessed a surge of over 350% in its stock value this year, while Bitcoin itself has gained nearly 160%.
In September of this year, MicroStrategy announced it increased its Bitcoin holdings by acquiring 5,445 Bitcoins. The total cost of the acquisition was approximately $147.3 million, with an average per Bitcoin cost of $27,053, inclusive of all associated fees and expenses. Currently the company is one of the most notable institutional holders of Bitcoin.
MicroStrategy’s Confidence in Bitcoin
The announcement comes amid growing anticipation regarding the potential approval of a spot Bitcoin exchange-traded fund (ETF) by the US Securities and Exchange Commission (SEC).
Over the past few months, there has been a surge in filings submitted to the regulator, including submissions from traditional financial entities such as BlackRock. Presently, around thirteen companies are awaiting potential SEC approval, with a final decision expected on 10th January 2024.
A spot cryptocurrency ETF would mirror the market price of the underlying crypto asset, providing investors with exposure to the token without the need to directly acquire the currency.
MicroStrategy’s strategic moves into Bitcoin have influenced the company’s stock performance, reflecting a notable surge. The company’s Bitcoin acquisitions showcase its confidence in the enduring value and stability of the digital asset, amidst growing anticipation surrounding the potential approval of a spot Bitcoin ETF.
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About The Author
Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
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Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
