MicroStrategy’s Bitcoin Holdings Nearing Breakeven Point Amidst Crypto Rally
The value of Bitcoin is approaching the average purchase price of the largest public holder of the cryptocurrency, MicroStrategy.
As of December 31, MicroStrategy held 132,500 bitcoins with an original cost basis of almost $4 billion, equating to an average cost of around $30,137.
Bitcoin’s price rose approximately 26% from a week ago, and at 3 pm ET on Monday, it was valued at about $28,200. MicroStrategy reported a net loss of $250 million during the fourth quarter of 2022, with its digital asset impairment charges amounting to $198 million during the same period.
Despite this, the company’s executives announced on an earnings call last month that they would continue with their long-standing strategy of holding bitcoin on their balance sheet.
Although analysts have criticized MicroStrategy for its buying and holding strategy during market volatility, the recent increase in Bitcoin’s value has helped to close the company’s unrealized losses from last November, leading to growing interest in decentralized finance and other crypto protocols.
One co-portfolio manager of the Amplify Transformational Data Sharing ETF (BLOK) stated that MicroStrategy’s CEO, Michael Saylor, has made it clear that the company will remain a strategic long-term bitcoin owner.
MicroStrategy’s stock price was up approximately 80% year-to-date, although it was down roughly 2% at $261.50 at 3 pm ET on Monday.