MicroStrategy, one of the largest institutional investors of Bitcoin, announced that it had purchased more Bitcoin during the month of January that saw the asset class lose over 16% of its value.
Michael Saylor, the CEO of MicroStrategy, in his usual fashion, took to Twitter to announce this purchase. The firm’s total Bitcoin holdings now stands at a total of 125,051 BTC. Using today’s market price, this puts the dollar figure at approximately $4.8 billion.
According to an official form with the United States Securities and Exchange Commission (SEC) filed on Tuesday, MicroStrategy purchased 660 BTC between December 30, 2021, and January 31, 2022, for “approximately $25 million” in cash.
What you should know
- The $25 million worth of Bitcoin got MicroStrategy a total of 660 BTC, purchased at an average price of $37,865 per BTC, including fees and expenses.
- MicroStrategy has now purchased a total of 125,051 BTC at an average purchase price of approximately $30,200 per coin. This means MicroStrategy has spent a total of approximately $3.78 billion on its BTC purchase, inclusive of fees and expenses.
- This means also means MicroStrategy is in profit by 26.82% as the firm as earned over a billion dollars in unrealized gains on its Bitcoin purchase.
- The latest report comes shortly after the United States’ Securities and Exchange Commission (SEC) reportedly rejected MicroStrategy’s Bitcoin accounting practices, causing MicroStrategy shares to plummet in mid-January.
- The SEC specifically objected to MicroStrategy reporting data related to BTC purchases stating that the form was not following Generally Accepted Accounting Principles (GAAP). The SEC argued that MicroStrategy used non-GAAP methods of calculating figures for its BTC buys excluding the “impact of share-based compensation expense and impairment losses and gains on sale from intangible assets.”
- The firm, in its latest earnings reported posted a net loss of $90 million or $8.43 a share in the fourth quarter, missing consensus estimates for a profit of 89 cents a share. This loss was largely attributable to MicroStrategy’s inclusion of impairment losses on its Bitcoin holdings, amounting to $147 million. That more than wiped out the company’s $110.5 million gross profit from its software business.
The latest Bitcoin buy is not big compared to the previous BTC purchases by MicroStrategy. In December 2021, MicroStrategy announced two major BTC purchases, buying 1,434 BTC from Nov. 29 to Dec. 9 at the average price of $57,477 per BTC and then purchasing 1,914 BTC from Dec. 9 to Dec. 29 at the average price of $49,229 per BTC. Previously, the company had bought as much as 7,002 BTC from Oct. 1 to Nov. 29 at the average price of $59,187 per BTC.
Bitcoin trades $38,300, down 0.60% for the day, as of the time of this writing.
