Nasdaq-listed business intelligence firm Microstrategy Inc. (NASDAQ: MSTR) has made its third major Bitcoin purchase, reinforcing its strategy of using the cryptocurrency as its primary treasury reserve asset. The company announced on December 4, 2020, that it had acquired approximately 2,574 bitcoins for $50 million in cash, at an average price of roughly $19,427 per coin. The purchase was conducted in accordance with its Treasury Reserve Policy and facilitated by Coinbase.
Third Batch Raises Total to 40,824 BTC
With this latest acquisition, Microstrategy now holds approximately 40,824 bitcoins, acquired at an aggregate purchase price of $475 million (including fees and expenses). Based on the current Bitcoin price of approximately $19,153, the company's Bitcoin holdings are worth over $780 million — representing a substantial unrealized gain. The first purchase, in August 2020, consisted of 21,454 bitcoins for $250 million, followed by a second purchase of 16,796 bitcoins for $175 million in September. All transactions were executed through the institutional trading desk of Coinbase.
The company also filed a Form 8-K with the U.S. Securities and Exchange Commission (SEC) to formally disclose the latest purchase, providing regulatory transparency for its growing crypto treasury.
CEO Michael Saylor: A Bitcoin Maximalist
Microstrategy CEO Michael Saylor has become one of the most prominent corporate advocates for Bitcoin. Since the first purchase, Saylor has appeared on numerous interviews and podcasts to explain why he believes Bitcoin is the best store of value — “many times better than gold.” In October 2020, he revealed that he personally holds 17,732 bitcoins, acquired at an average price of $9,882 each. His personal conviction aligns with the company's strategy, further cementing his reputation as a Bitcoin maximalist.
Saylor tweeted the news of the latest purchase, stating: “Microstrategy has purchased approximately 2,574 bitcoins for $50.0 million in cash in accordance with its Treasury Reserve Policy, at an average price of approximately $19,427 per bitcoin. We now hold approximately 40,824 bitcoins.”
Implications for Institutional Adoption
Microstrategy’s aggressive Bitcoin accumulation has served as a landmark case study for institutional adoption. The company was the first publicly traded firm of its scale to allocate a significant portion of its treasury to Bitcoin, inspiring other public companies and corporate treasuries to consider similar moves. The market has responded positively: Microstrategy’s stock price has seen notable increases in tandem with its Bitcoin purchases and the subsequent rise in BTC price.
The total value of Bitcoin held by Microstrategy now exceeds $780 million, amplifying the company's exposure to cryptocurrency volatility but also positioning it as a proxy for Bitcoin in traditional equity markets. Analysts believe that Microstrategy’s ongoing commitment could encourage other firms like Square, Galaxy Digital, and even larger corporations to follow suit.
Market Context and Outlook
This latest purchase comes at a time when Bitcoin is trading in the $19,000 range, just below its all-time high of around $20,000 reached in late 2017. The market has entered a phase of price discovery, fueled by institutional demand from companies like Microstrategy, Grayscale Investments, and payment processors like PayPal. Bitcoin’s narrative as a hedge against fiat inflation has gained traction amid unprecedented central bank money printing and low interest rates.
Microstrategy’s treasury strategy is not without risks. The company’s core business intelligence software operations generate cash flow, and the decision to park that cash in a volatile asset like Bitcoin could face scrutiny from shareholders if prices decline sharply. However, Saylor remains steadfast, signaling that the company may continue to acquire Bitcoin as part of its long-term value preservation strategy. The market will be watching Microstrategy’s next moves closely, as the company effectively doubles as a Bitcoin investment vehicle within the stock market.