Strategy Expands Bitcoin Holdings by Nearly $2 Billion in Latest Purchase

RESTON, Va. — Business intelligence firm Strategy, formerly known as MicroStrategy, announced on Monday that it has significantly boosted its Bitcoin acquisitions, purchasing an additional 20,356 Bitcoins valued at approximately $1.99 billion. This recent purchase was executed at an average price of $97,514 per Bitcoin, as detailed in the company’s regulatory filing.

With the latest acquisition, Strategy now holds a remarkable total of 499,096 Bitcoins, representing over 2.3% of Bitcoin’s fully diluted supply, which is capped at around 21 million. According to the Bitcoin supply tracker BitcoinTreasuries, only one other entity holds a larger portion of total Bitcoin supply: a company that has nearly 2.8% of all existing Bitcoins.

Strategy’s Executive Chairman Michael Saylor shared insights about the acquisition on X, indicating a pattern of frequent purchases that have occurred weekly since November. This latest buy marks the largest Bitcoin acquisition since December 9.

Funding for the acquisition has primarily stemmed from a combination of equity and debt, allowing Strategy to aggressively expand its Bitcoin portfolio. The company’s share price has witnessed a massive surge exceeding 300% over the past year, although they experienced a 4% dip in late trading on Monday.

Bitcoin has stabilized within a narrow range recently, trading around $95,000, significantly below its record high of approximately $109,000 reached last month. Regardless, Strategy continues to express confidence in the long-term value of Bitcoin.

“Our focus remains on acquiring Bitcoin as a long-term treasury strategy,” Saylor remarked in a statement. “We see Bitcoin as a hedge against inflation and a solid investment for the future.”

Despite the positive growth and high profits from their Bitcoin investments, skepticism surrounds the sustainability of this aggressive acquisition strategy. Concerns have surfaced about the company’s ability to maintain such a trajectory without facing significant long-term financial repercussions.

Investors should be mindful that while Strategy’s stock appears to reflect impressive gains, ongoing discussions about the long-term viability of holding extensive Bitcoin reserves persist. As of the latest market data, Strategy’s Bitcoin holdings are estimated to be worth around $47.8 billion, equating to a paper profit of about $14.7 billion, or 44%.

As the company ventures closer to the milestone of half a million Bitcoins, its influence on both the market and on other institutional investors remains a subject of keen interest. The acquisition strategy has paired with a recent $2 billion convertible note offering, intended to continue funding the company’s pursuit of Bitcoin.

As Strategy approaches this ambitious goal, it can be surmised that their actions could set a notable precedent for institutional engagement with Bitcoin as a treasury asset. The road ahead may hold challenges, but Strategy’s financial maneuvers underscore the growing significance of Bitcoin in corporate finance policy.