Microstrategy adds billions more in fifth-straight weekly buying

Software development firm MicroStrategy has restocked its massive Bitcoin stash, announcing on Monday that it bought $2.1 billion worth of the major cryptocurrency in its fifth-straight weekly purchase last week.

Microstrategy added 21,550 BTC worth $2.1 billion, with an average purchase price of $98,783, founder and CEO Michael Saylor at X (formerly known as Twitter).

That pushed the company's holdings to 423,650 BTC, worth nearly $42 billion, at an average price of $60,324 per Bitcoin.

MicroStrategy has stepped up its Bitcoin purchases, adding 171,430 new Bitcoins to its balance sheet, adding 171,430 new Bitcoins to its balance sheet every week since November 11th. It spent a total of $15.6 billion during this period.

Bitcoin's price is up about 22 percent since Nov. 11, when it was trading at less than $81,000 per coin. Today, the price is $98,572 according to CoinGecko.

MicroStrategy was a small software company that, in Saylor's words, “couldn't get ahead.” In the year When the Covid-19 pandemic hit in 2020, the company went into a state of panic and began to think about the best way to protect shareholders as the value of cash was rapidly declining.

The answer was Bitcoin—and the publicly traded company under Saylor spent $250 million on 20,000 Bitcoin in August 2020.

MicroStrategy has been buying orange coins ever since, and now operates as a “Bitcoin Treasury” or “Bitcoin Development Company” that secures its assets: the company uses debt to raise large amounts of cryptocurrency, and investors buy MicroStrategy stock as a proxy for buying Bitcoin directly themselves.

Hedge funds have become interested in buying convertible notes traded in micro-strategies to finance their Bitcoin purchases.

So far, the bet has paid off: MicroStrategy (NASDAQ: MSTR ) has beaten most public companies in the US as its stock has risen alongside the value of Bitcoin. The stock price has increased more than 2,500% since the initial purchase.

But since microstrategy wealth is now so closely tied to Bitcoin itself, it's unclear how much investors would lose if BTC's price crashed.

Editor's note: This story has been updated after publication with additional details.

Edited by Andrew Hayward.