Bitcoin Dominator Microstrategy announced yesterday (20th) that it has once again increased its holdings by 11,931 bitcoins (total value of 786 million US dollars), bringing its total holdings to about 226,400 bitcoins.
(Background information:
Microstrategy’s stock price plummeted nearly 8% after announcing a $500 million increase in Bitcoin holdings. Has the magic of Bitcoin’s bull market run out?)
(Background information:
After Microstrategy bought Bitcoin, its stock price skyrocketed by 750%. Will investing in BTC follow Microstrategy become a global corporate trend?)
Table of Contents:
Microstrategy Increases Holdings by 11,931 BTC
Microstrategy has been buying BTC since August 2020
Can you make money by following Microstrategy’s Bitcoin purchases?
Microstrategy, the dominant holder of Bitcoin among US-listed companies, announced on June 13th that it plans to issue $500 million worth of convertible bonds due in 2032 through a private placement. The funds raised will be used to purchase Bitcoin and for company operations.
In the latest disclosure document released yesterday evening, Microstrategy stated that it completed the convertible bond issuance on June 18th, raising $786 million in new capital. They have already purchased 11,931 bitcoins at an average price of $65,883 per bitcoin.
This further increases Microstrategy’s current Bitcoin holdings to about 226,400 bitcoins, with a total value of approximately $14.7 billion. According to the latest statistics, Microstrategy’s total investment cost is about $8.33 billion, with a current unrealized profit of over $6.4 billion.
Microstrategy has been continuously investing in Bitcoin since August 2020 when its founder, Michael Saylor, announced the plan. This has led to a frenzy of accumulating coins, resulting in substantial gains in both their Bitcoin holdings and stock price. The stock price has risen from $146 in August 2020 to $1,474, an increase of over 900%.
(Figure)
Microstrategy’s Bitcoin holdings and stock price changes
Can you make money by following Microstrategy’s Bitcoin purchases?
According to data compiled by bitcointreasuries, Microstrategy has made dozens of additional purchases since August 2020.
Long-term (4 years):
If you had followed Microstrategy’s footsteps from the beginning, with the current Bitcoin market price of $65,000, you would have bought at a higher price on June 20th, March 31st, and March 10th this year. The lowest purchase price was on September 14th, 2020, at an average price of $10,329.
In other words, if you had followed Microstrategy’s steps and held Bitcoin until now, you would have made a substantial profit.
(Figure)
Microstrategy’s historical Bitcoin accumulation timeline
Short-term (looking at the past year):
If we look at the data from the past year, Microstrategy has made a total of 13 purchases since June 28th last year. Basically, except for buying at higher prices in March this year (three additional purchases), the other entry points have also yielded significant profits, indicating a relatively high investment success rate.
However, since Microstrategy started its Bitcoin accumulation early, the average purchase cost after multiple additional purchases is only around $36,000. And if you started buying during the bull market in 2021, you would have experienced a long period of significant losses.
Therefore, if you start following Microstrategy’s footsteps to buy BTC now, it may be difficult to make substantial profits in the short term. Investors should do their own research (DYOR).
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