- Microstrategy stocks lost 13% of its value in the last 5-day trading period.
- Michael Saylor has confirmed that the company’s BTC holding reached 214,246 BTC.
Shares of MicroStrategy fell further Bitcoin [BTC] sustained losses reached +$10K from the recent high of $73.7K.
A recent Bloomberg report shows that MicroStrategy’s leveraged BTC buying strategy has led to the stock’s volatility.
“MicroStrategy fell 16% on Monday, more than ten times Bitcoin’s decline. It fell 5.7% on Tuesday as the digital token retreated from record highs.”
The tech company’s shares extended losses on March 20. In total, the shares have lost 13% of their value in the past five days.
MicroStrategy’s Aggressive Bitcoin Accumulation
Bloomberg highlighted the recent MicroStrategy losses due to Bitcoin’s inherent volatility risk. In a recent report, Bloomberg stated that;
“The company has been pushing the token since 2020, making its shares a proxy for those looking to bet on the largest cryptocurrency without buying it outright.”
As a result, Lance Vitanza, director of equity research at TD Cowen, told Bloomberg: “That’s the only reason to buy MicroStrategy stock is because you want to own Bitcoin.”
Interestingly, the company retained its unique appeal despite the new and popular US spot ETFs that offer an alternative option for investors looking for exposure to BTC.
“In addition to the stock’s appeal given the company’s ability to sell debt to fund Bitcoin purchases, another advantage is that as a stock it doesn’t charge management fees like ETFs.”
The company resorted to selling debt, especially convertible bonds, to boost BTC accumulation.
On March 18, 2024, Michael Saylor, chairman and CEO of the company, confirmed that MicroStrategy’s BTC holding reached 214,246 BTC.
This interest equates to the fact that 1% of Bitcoin has ever been mined to date, with about a quarter of the purchase taking place in 2024.
The US-based company’s shares are clearly bound to the vagaries of BTC’s wild price swings as of now. As such, the impact that MicroStrategy has can flow to BTC and vice versa.