MicroStrategy purchases 3,907 Bitcoin after selling 230K MSTR

MicroStrategy, a business software company, has purchased an additional 3,907 Bitcoin (BTC). The firm unveiled this news through a filing with the US Securities Exchange Commission (SEC) yesterday. Through this purchase, the company’s holdings of the leading cryptocurrency have increased to 108,992 BTC. 

According to the filing, the company spent $177 million on BTC between July 1 and August 23. MicroStrategy further noted that it purchased the BTC at an average price of $45,294 per coin. From this data, it is easy to tell that the company purchased the bulk on the 3,907 coins after the BTC market breached the $40,000 level on its journey to reclaim some of its mid-May losses. 

Shedding light on how it obtained funds to purchase such a large sum of BTC, MicroStrategy said cited a June 14, 2021 disclosure, in which it entered into an Open Market Sale Agreement with Jefferies LLC. This deal saw Jefferies act as a sales agent for MicroStrategy’s class A common stock (MSTR). 

MicroStrategy said it managed to issue and sell 238,053 MSTR via Jefferies between July 1 and August 23. Each share, reportedly, went for an average gross price of $753.21. After paying sales commissions and covering expenses, MicroStrategy remained with $177.5 million.

Undivided devotion to BTC

This news comes after MicroStrategy vowed to purchase more BTC after suffering an impairment loss of $424.8 million in Q2, 2021. Before this, the firm purchased 13,005 BTC for $489 million in June after raising $500 million from the sale of senior secured banknotes. This move attracted a lot of criticism, with experts claiming that it was irresponsible of the company to borrow such a vast amount of money and invest it in a speculative and volatile asset. 

However, Michael Saylor, MicroStrategy’s CEO, believes BTC will gain in the long term. In a recent interview, he compared buying BTC to investing early in tech companies like Google and Facebook.

In the interview, the BTC maximalist said,

“If you borrow billions of dollars at 1% interest and invest it in the next Big Tech digital network that you thought was going to be the dominant Amazon or Google or Facebook of money, why wouldn’t you? I mean, if I could borrow $1 billion and buy Facebook a decade ago for 1% interest, I think I would’ve done quite well.”

Saylor added that everyone is looking for a transparent way to store and move value at the speed of light, and BTC is the digital property on a big open monetary network. He further noted that MicroStrategy believes it will only be a matter of time before the entire world is rushing to embrace BTC. As such, the company’s regular purchases only seek to cement its position in the next big thing.

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