Chief Financial Officer Phong Le told Insider in an interview that the company is unfazed by the bitcoin slump as its approach is to buy and hold the cryptocurrency. Bitcoin, which has dropped from its all-time high in November of about $69,000 to $36,864 Tuesday, is an “intrinsically volatile asset,” he said.
“We don’t think of short-term volatility as a reason not to be bullish on bitcoin long-term,” he said. The Wall Street Journal said MicroStrategy plans to continue to put funds into bitcoin to the extent it has excess cash flows or other ways to raise money.
Le also said MicroStrategy is considering other ways to invest in bitcoin, like bitcoin-backed bonds. He said the firm is waiting for the market to mature before buying in, though. He added that bitcoin remains the strongest cryptocurrency in the digital asset market by far, but the firm is keeping an eye on other “second-tier” cryptocurrencies as they mature. He declined to name which ones.
Saylor previously has said he’s not concerned about bitcoin’s slump and vowed that his firm, which holds about 125,000 bitcoin, would never sell its crypto stash because its strategy is “acquiring and holding” the coin.
Shares of the software firm have slumped 34% so far this year, with much of the slide happening since Friday. The firm has taken out billions in debt to buy up thousands of bitcoins at an average purchase price of $30,159. Le said the company isn’t worried about defaulting on its loans if bitcoin were to fall below the average buying price for an extended period of time because the first bond payment isn’t due for several years, and its software business generates tens of millions in free cash flows that can help pay down debt.
The US Securities and Exchange Commission also recently asked the company to revise its crypto accounting practices, meaning MicroStrategy can’t strip out bitcoin’s price swings from its unofficial non-GAAP accounting measures it presents to investors.