MicroStrategy, a business intelligence firm, has added to its Bitcoin holdings yet again. This time, the company added nearly 9,000 BTC, bringing the total value of its Bitcoin holdings to around $7 billion.
In its third-quarter financial report, released on October 28th, the company revealed that it had purchased an additional 8,973 BTC in Q3. With the addition of the new coins, the firm’s total Bitcoin holdings amounted to 114,042 BTC, with an estimated average purchase price of $27,713 per coin, or a total spend of $3.16 billion.
Over the last year, the company has continued to add Bitcoin to its balance sheet. It purchased its first 21,000 BTC in August 2020 and has since rapidly increased its holdings.
According to the aforementioned report, MicroStrategy CEO and Bitcoin bull Michael Saylor hinted that the buying spree would continue, stating,
“Today, with over 114,000 Bitcoins, MicroStrategy is the world’s largest publicly traded corporate owner of Bitcoin.” We will continue to assess opportunities to raise additional capital in order to carry out our Bitcoin strategy.”
Since the acquisition, the company has recorded a carrying value of $2.406 billion for its BTC, with an impairment loss of $754.7 million. However, the accounting rules for digital assets require companies to report an impairment if the asset’s price falls below the price at which it was purchased at any time during the quarter. As a result, the registered loss exists only on paper.
At the time of writing, the value of MicroStrategy’s BTC holdings was estimated to be around $7 billion. This implies that if its accumulated tokens are sold today, a profit of around $3.75 billion can be made.
Saylor stated during a conference call that his company was committed to purchasing more Bitcoin because it was a “great” long-term investment for shareholders. There were no intentions of selling. He also mentioned that Bitcoin-linked ETFs were a “testing ground” for institutional investors.
The approval of BTC ETFs in the United States, according to experts, could spell trouble for the company. According to them, “it may be a better option than investing in MicroStrategy stock.” The reason for this is that it was used as a stand-in for institutional Bitcoin investments in the absence of regulated products.
The stock of the company had also dropped immediately following the launch of the ProShares ETF, as investors rebalanced their exposure to the digital asset.
The CEO of Galaxy Digital Holdings recently stated that it was only a matter of time before cryptocurrency surpassed gold in market capitalization. Mike Novogratz also stated that cryptocurrencies had “passed the tipping point” in terms of public acceptance, which is why the company was planning to launch its own cryptocurrency ETFs.