CoinInsight360.com logo CoinInsight360.com logo
A company that is changing the way the world mines bitcoin

WallStreet Forex Robot 3.0
NewsBTC 2024-11-25 16:24:44

Historic Bitcoin Buy: MicroStrategy Adds 55,500 More BTC To Its Portfolio For $5.4 Billion

Business intelligence firm MicroStrategy has significantly increased its Bitcoin (BTC) purchases this month in response to the bullish sentiment following President-elect Donald Trump’s victory on November 5. The company’s recent acquisitions have pushed its total Bitcoin holdings to approximately $38 billion. Convertible Notes Fuel Massive Bitcoin Purchase On November 25, co-founder Michael Saylor announced via social media that MicroStrategy had acquired 55,500 BTC between November 18 and November 24 for $5.4 billion. This purchase was funded by proceeds from a $3 billion convertible note issuance and sales of common shares, as detailed in a filing with the US Securities and Exchange Commission (SEC). Related Reading: XRP Price Builds a Base: Can Bulls Ignite a New Rally? Since beginning its Bitcoin acquisition strategy in 2020, Saylor has shifted from using corporate cash to a more complex funding model that involves selling convertible debt and shares. The latest convertible note was issued at a zero percent interest rate, reflecting lenders’ confidence that MicroStrategy’s stock will appreciate beyond the conversion price in the future. Jeffrey Park, a portfolio manager at Bitwise Asset Management, noted that Saylor has effectively leveraged financial arbitrage within the corporate treasury structure, allowing MicroStrategy to borrow funds at virtually no cost. Saylor also revealed that MicroStrategy’s treasury operations have yielded a substantial 59.3% in Bitcoin returns year-to-date, translating to a net gain of approximately 112,125 BTC for shareholders, or about 341 BTC per day. At a projected price of $100,000 per BTC, Saylor stated that this could mean an impressive $11.2 billion for the year, equating to roughly $34.1 million daily. Analyst Warns Of Risks In Leverage Strategy Since its foray into Bitcoin, MicroStrategy has acquired a total of 386,700 tokens, with an average purchase price significantly lower than its current market value. The latest acquisitions occurred while Bitcoin prices were nearing all-time highs, with the company purchasing the new tokens at approximately $97,862 each, slightly above their current trading price. Related Reading: Solana (SOL) Bulls Stay in Control: Rally Far From Over? However, this leveraged strategy has raised concerns among some analysts, particularly after MicroStrategy’s shares (MSTR) fell by 16% last Thursday. Critics warn that if Bitcoin’s price declines sharply, the company’s stock could suffer similarly, recalling the downturn in 2022 when the cryptocurrency market experienced significant losses. TD Cowen analyst Lance Vitanza remarked on the risks associated with leverage, stating, “When you apply leverage to anything, you amplify the returns both in the up direction and in the down direction.” He emphasized that MicroStrategy is a pioneer in applying this leverage strategy specifically to Bitcoin. At the time of writing, the market’s leading crypto is trading at $95,350, registering a price decrease of 1.7% in the 24-hour time frame. Featured image from DALL-E, chart from TradingView.com

Leggi la dichiarazione di non responsabilità : Tutti i contenuti forniti nel nostro sito Web, i siti con collegamento ipertestuale, le applicazioni associate, i forum, i blog, gli account dei social media e altre piattaforme ("Sito") sono solo per le vostre informazioni generali, procurati da fonti di terze parti. Non rilasciamo alcuna garanzia di alcun tipo in relazione al nostro contenuto, incluso ma non limitato a accuratezza e aggiornamento. Nessuna parte del contenuto che forniamo costituisce consulenza finanziaria, consulenza legale o qualsiasi altra forma di consulenza intesa per la vostra specifica dipendenza per qualsiasi scopo. Qualsiasi uso o affidamento sui nostri contenuti è esclusivamente a proprio rischio e discrezione. Devi condurre la tua ricerca, rivedere, analizzare e verificare i nostri contenuti prima di fare affidamento su di essi. Il trading è un'attività altamente rischiosa che può portare a perdite importanti, pertanto si prega di consultare il proprio consulente finanziario prima di prendere qualsiasi decisione. Nessun contenuto sul nostro sito è pensato per essere una sollecitazione o un'offerta