MicroStrategy Ramps Up Bitcoin Holdings Amid Cryptocurrency Market Surge
MicroStrategy, a leading software company, made headlines with its recent Bitcoin investment endeavors. The company disclosed an addition of 6,067 Bitcoins to its digital asset portfolio, an acquisition valued at $167 million.
This latest move has substantially boosted their total Bitcoin holdings to an impressive 158,400 Bitcoins, procured at an average cost of $29,586 per coin. Notably, the company secured these additional coins at an average price of $27,531.
This ongoing acquisition trend was further highlighted by MicroStrategy’s chairman, Michael Saylor, who revealed the purchase of an extra 155 Bitcoins in October, amounting to $5.3 million. Saylor emphasized the company’s unwavering commitment to Bitcoin acquisition, citing a positive outlook on increased institutional adoption as a key motivator.
MicroStrategy’s strategic Bitcoin investment aligns with the current surge in the cryptocurrency market. Recently, Bitcoin achieved a remarkable high, hitting $35,878, a record for the year.
In their third-quarter financial report, MicroStrategy demonstrated a 3.3% rise in revenue, reaching $130 million. However, the company also disclosed a significant setback, registering a net loss of $143.4 million, a substantial increase compared to the $27 million loss in the same period the previous year.
During this quarter, MicroStrategy acknowledged an impairment loss of $125.8 million on their Bitcoin holdings. This was attributed to the market price of Bitcoin being lower than the carrying value by September 30, 2023, significantly impacting the company’s financial standing.
The company attributed the increased provision for income taxes, totaling $109.6 million for the third quarter of 2023, to changes in the valuation allowance on their deferred tax asset due to the impairment on Bitcoin holdings. This is notably higher compared to the $24.0 million reflected during the same period in 2022.