MicroStrategy, a publicly traded software company, now holds over $36.8 billion worth of bitcoin, according to recent financial disclosures.
On November 25, the Virginia-based company revealed in an SEC filing that it had acquired approximately 55,500 bitcoins between November 18 and November 24, spending $5.4 billion in cash. This purchase increased its total bitcoin holdings to 386,700 tokens, currently valued at $36.8 billion.
Following this announcement, MicroStrategy's stock experienced a sharp drop, plummeting to $383.80 per share from an opening price of $440.75 during morning trading. However, the stock partially recovered by midday, stabilizing around $405 per share.
Describing itself as the “world’s first and largest Bitcoin treasury company,” MicroStrategy positions cryptocurrency as its primary reserve asset. In a statement, the company emphasized its strategy of accumulating bitcoin and advocating for its role as “digital capital.” It also offers investors economic exposure to bitcoin through various securities, including equity and fixed-income instruments.
Apart from its cryptocurrency investments, MicroStrategy develops and sells analytics software.
Bitcoin, a decentralized cryptocurrency secured through encryption technology, allows value transfer without intermediaries like banks. It is not backed by governments, central banks, or physical assets. Initially valued at under $0.10, bitcoin’s price has surged over the last decade, trading at approximately $95,845 per token as of midday on November 25. This represents a substantial rise from $44,200 at the start of 2024.
The cryptocurrency’s 2024 price surge accelerated after Election Day, climbing 39% between November 4 and November 25. Supporters, including the political group Stand With Crypto, attribute this growth to the election of crypto-friendly policymakers.
President-elect Donald Trump has pledged to maintain the U.S. as a global leader in cryptocurrency. He appointed financier Howard Lutnick, known for his ties to Tether, as commerce secretary.
MicroStrategy’s SEC filing also noted that the company purchased approximately 197,550 bitcoins in 2024.
In a CNBC interview, CEO Michael Saylor shared that the company profits by "selling volatility and reinvesting in bitcoin." Saylor projected that bitcoin's value would grow by 29% annually for the next 21 years, adding that MicroStrategy has already gained $5.4 billion in bitcoin profits over two weeks.
In a recent social media post, Saylor highlighted the company's bitcoin purchases' 59.3% annual yield, predicting potential gains of $11.2 billion in 2024 if bitcoin's price reaches $100,000 by year-end.
Despite these optimistic projections, MicroStrategy's financial reports reveal challenges. For the quarter ending September 30, the company reported a net loss of $340 million. Over the first nine months of 2024, losses totaled $495.8 million, a stark contrast to its $340 million net profit during the same period in 2023.
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