MicroStrategy Bought 9,000 Bitcoins in Q3, Plans to Raise Capital for More
MicroStrategy (Nasdaq: MSTR), the business-intelligence software firm that has so much bitcoin on its balance sheet that it’s become something of a proxy for the world’s largest cryptocurrency, said it added about 9,000 bitcoins to its holdings in the third quarter, increasing its total to 114,042.
The bitcoin was acquired by the firm after it “successfully raised funds in the quarter via at-the-market share offering.” At present rates, the value of MicroStrategy’s bitcoin holdings is somewhat more than $7 billion; the company’s total market capitalization is around $7.4 billion.
MicroStrategy’s bitcoin had a carrying value of $2.406 billion, reflecting cumulative impairment losses of $754.7 million. Companies must record an impairment under digital asset accounting standards if the asset’s price falls below the company’s acquisition price at any moment during the quarter.
“We will continue to investigate ways to acquire more funding to deliver on our bitcoin strategy,” the business added. In the third quarter, the firm obtained funds via at-the-market share offering to add about 9000 bitcoins (BTC-USD) to its holdings.
On MicroStrategy’s earnings conference call, CEO Michael Saylor said that the business is dedicated to purchasing bitcoin and has no intentions to sell it. Bitcoin, according to Saylor, is a “wonderful” long-term investment for shareholders.
Saylor is open to collaborations that might lead to MicroStrategy purchasing more bitcoin. According to Saylor, the previous three months have seen “very dramatic” changes for bitcoin, including as increased institutional usage and ongoing regulatory debates.
According to Saylor, Bitcoin-linked ETFs are another “checkbox” for institutional investors. Saylor went on to say that there is a “deep game-changing relationship here between big tech and bitcoin,” citing examples such as Square’s Cash App and Twitter’s tip feature.
Overall, MicroStrategy reported adjusted profits per share (EPS) of $1.86 on $128.0 million in sales for the quarter, exceeding analyst projections of $0.64 and $127.5 million, respectively, according to FactSet.
As of September 30, 2021, the carrying value of MicroStrategy’s (MSTR) digital assets, which included 114,042 bitcoins (BTC-USD), was $2.406B, reflecting cumulative impairment losses of $754.7M since purchase and an average carrying amount per bitcoin of roughly $21,095.