Microstrategy seems be doubling down on Bitcoin after the company purchased another 16,796 BTC worth $175 million.
Microstrategy’s Total Bitcoin Holdings Worth $425 Million
Tweeting on Tuesday (September 15, 2020) the company’s CEO Michael Saylor announced the addition of 16,796 BTC to its stash. Although BTC’s value has risen and plunged since Microstrategy’s earlier investment, the company is not showing any signs of giving up on the flagship crypto.
The Nasdaq-listed business intelligence software company earlier stated in a filing with the U.S. Securities and Exchange Commission (SEC) , that it could buy more bitcoin. The company’s Board also officially declared Bitcoin as its primary treasury reserve asset.
An excerpt from the filing stated:
“Bitcoin serving as the primary treasury reserve asset on an ongoing basis, subject to market conditions and anticipated needs of the business for Cash Assets, including future potential share repurchase activity. As a result of this new Policy, the Company’s holdings of bitcoin may increase beyond the $250 million investment that the Company disclosed on August 11, 2020.”
The new bitcoin purchase according to Saylor was worth $175 million. As reported by BTCManager in August, Microstrategy purchased 21,454 BTC worth $250 million at the time. Speaking on the decision to invest in BTC, the company’s CEO referred to Bitcoin as “a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash.”
This brings the total number of the company’s Bitcoin holdings to 38,250, with a total aggregate price of $425 million including expenses and fees.
Institutional Interest in Bitcoin on the Rise
Microstrategy’s latest BTC purchase caused reactions from different industry experts. Gemini’s Tyler Winklevoss commended the company’s move, stating that “they understand that bitcoin will outrun the scourge of inflation.”
Meanwhile, Barry Silbert, CEO of top crypto asset management firm Grayscale noted that there seemed to be a competition between Grayscale and Microstrategy regarding BTC purchases. While Microstrategy’s Bitcoin portfolio is under 40,000, Grayscale BTC holdings is above 400,000.
Apart from Microstrategy, more businesses have adopted Bitcoin as their primary reserve asset with BTC’s scarcity being the major attraction. In August, Tahinis, a Middle Eastern restuarant based in Canada annouced that it was converting all its cash reserves to Bitcoin.
Another Canadian company Snappa in the same month revealed that it started acquiring BTC in March 2020. The company stated that it held a significant portion of its cash reserves in Bitcoin.
Back in June, Ryan Watkins, crypto analyst at cryptocurrency research platform Messari, predicted that BTC’s value could surpass $50,000 if there is a 1% allocation of institutional funds to Bitcoin.