Microstrategy purchases $200 million worth of Bitcoin after recently acquiring a $205 million Bitcoin-backed loan from Silvergate bank. The company informed that the reason for the loan was company operations and acquiring more BTC. However, it seems the latter is primarily the case. With the latest purchase, their total holdings have risen by 4,167 Bitcoins to 129,218 BTC.
Microstrategy purchases $200 million worth of Bitcoin
The past data suggests that Bitcoin gives very high annual returns on average. This makes it an incredibly good idea to get a much cheaper BTC-backed loan to buy more Bitcoins. However, there is definitely the risk of BTC not rising again, which is a tough call but is definitely worth considering.
The latest purchase of the company was at an average price of $45,174 and has brought up that total average price to $30,700 per BTC. So, even now, Microstrategy is up by 50% on their Bitcoin investments which don’t seem to be a bad deal. However, their latest investment alone is at a loss, with BTC falling to $45,200 after the strong rejection from $47.3k. Though it is just a matter of time before the markets recover and we move towards a new all-time high.
Michale Saylor on Bitcoin
Michael is a firm believer in the future of Bitcoin, and therefore he always advocates in its favor. Time and again, Saylor has talked about the adoption of BTC increasing and it being the future. In the Q1 earnings call of the company as well, he talked about higher institutional adoption with hedge and macro funds.
Micahel has also explained that Bitcoin is not bad for the environment because it uses renewable energy and is able to tap into sources that would have been otherwise wasted. A good example of this is Exxon Mobil, the world’s 4th largest gas company mining BTC with excess gas that would have been flared otherwise. This is a case that we have heard about and made the news. However, a lot of miners are off-grid, taking advantage of such energy sources.
What are your thoughts as Microstrategy purchases $200 million worth of Bitcoin using the BTC-backed loan? And do you think taking a loan to buy BTC is an ingenious idea or a risky gamble? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.