Business intelligence firm MicroStrategy made waves this week with the disclosure that it purchased over $593 million worth of bitcoin in November.
The sizable purchase of 16,130 tokens was MicroStrategy's largest bitcoin acquisition since February 2021, when the company spent $1 billion to add nearly 20,000 bitcoins to its corporate treasury.
Keypoints
- MicroStrategy purchased $593.3 million worth of bitcoin in November, its largest bitcoin buy since February 2021 when it spent $1 billion
- The purchase of over 16,000 bitcoins brings MicroStrategy's total bitcoin holdings to around 174,530 tokens, now worth about $6.5 billion
- MicroStrategy Chairman Michael Saylor aims to acquire as much bitcoin as possible, believing it will increase 10x in value again
- MicroStrategy stock price has mirrored bitcoin's surge, with shares up 175% in 2023 alongside bitcoin's 127% price jump
- Purchase comes amid growing Wall Street bullishness on bitcoin and confidence an SEC-approved bitcoin spot ETF is coming soon
Led by outspoken bitcoin bull Michael Saylor, MicroStrategy has made accumulating bitcoin a key pillar of its business strategy. Saylor aims to stack as many of the scarce digital tokens as possible, betting that bitcoin's market dominance and price will ascend dramatically in the coming years. "I think that the public is beginning to realize that bitcoin is the next bitcoin," Saylor stated in August, predicting 10x growth again in the future.
MicroStrategy's November bitcoin splurge brings its holdings to around 174,530 tokens, now worth approximately $6.5 billion. The average purchase price was $36,785 per bitcoin. Saylor's bitcoin accumulation plan has pushed MicroStrategy's stock price higher in tandem with bitcoin's gains this year. Shares are up 175% year-to-date, closely correlating to bitcoin's 127% price appreciation in 2023.
The timing of MicroStrategy's latest bitcoin acquisition coincides with resurging optimism around further institutional adoption of the cryptocurrency. Signs point to the likely impending approval of a spot bitcoin ETF in the U.S., which would allow mainstream investors easy exposure to bitcoin prices without having to directly hold the asset.
Saylor himself noted on a November earnings call that the launch of spot bitcoin ETFs would serve as a "catalytic event", driving greater Wall Street participation in bitcoin and benefiting firms like MicroStrategy with heavy bitcoin allocations. With federal regulators appearing increasingly open to such proposals, MicroStrategy seems to be stocking its bitcoin treasury ahead of what it sees as a tidal wave of institutional demand entering the market soon.
If bitcoin ETFs unlock a flood of new institutional capital, increasing competition amongst investors piling into the limited bitcoin supply, MicroStrategy stands ready to ride the wave with its 174,000-bitcoin war chest. Saylor is betting big that the public will soon fully recognize the disruptive potential of "the next bitcoin" - and MicroStrategy now holds over $6 billion worth of chips on the table.
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