Software company MicroStrategy has purchased more than $5 billion worth of bitcoin, according to new financial disclosures.
On Nov. 25, the Tysons Corner, Virginia, software company said in a Securities and Exchange Commission (SEC) filing that it had purchased about 55,500 bitcoins for about $5.4 billion in cash between Nov. 18 and Nov. 24. The moves brought its total holdings of the digital currency to 386,700 tokens. At the current price, that translates to about $36.8 billion of holdings.
MicroStrategy’s stock crashed following news of the purchase, falling to as low as $383.80 a share in morning trading from an opening price of $440.75. However, as of about midday on Monday, the price recovered to about $405 a share.
MicroStrategy describes itself as the “world’s first and largest Bitcoin treasury company,” using cryptocurrency as its primary treasury reserve asset.
“We strategically accumulate Bitcoin and advocate for its role as digital capital,” the company said in a recent statement. “Our treasury strategy is designed to provide investors varying degrees of economic exposure to Bitcoin by offering a range of securities, including equity and fixed-income instruments.”
In addition, the company makes and sells analytics software.
Bitcoin is a cryptocurrency, a digital asset secured via encryption technology in an unalterable and publicly visible way. Cryptocurrencies such as bitcoin make it possible to transfer value online without a bank or payment processor. As a digital asset, cryptocurrency is not backed by governments, central banks, or physical assets.
Although bitcoin began as an obscure novelty valued at less than 10 cents per token, its price has exploded over the past decade. As of about midday on Nov. 25, the cryptocurrency was trading at about $95,845 per token. That is a massive increase from the $44,200 per token the digital asset traded for at the beginning of 2024.
Bitcoin’s 2024 bull run got a giant boost after Election Day. The price of bitcoin rose by about 39 percent between Nov. 4 and Nov. 25. Bitcoin advocates, such as the political group Stand With Crypto, said voters sent politicians to Capitol Hill who will enact policies more favorable to the ascendant crypto industry.
President-elect Donald Trump promised to keep the United States the world’s leader in cryptocurrency. Trump selected Howard Lutnick, a financier with solid ties to alternative cryptocurrency Tether, as his commerce secretary.
According to its Monday SEC filing, MicroStrategy has purchased about 197,550 bitcoins in 2024.
In a recent appearance on CNBC’s “Squawk Box,” MicroStrategy CEO Michael Saylor said his business makes money by “selling the volatility and recycling it back into bitcoin.”
“We expect that [bitcoin’s] going to go up 29 percent a year for the next 21 years. It’s been going up 60 percent a year,” Saylor said on CNBC. “Over the last two weeks, we generated $5.4 billion in BTC gains. We’re making $500 million a day.”
In an X post published on Monday, Saylor said its bitcoin purchases delivered an annual yield of about 59.3 percent to the company’s shareholders. If bitcoin’s price were to reach $100,000 per token by the end of the year, Saylor said, that would equate to a yield of $11.2 billion in 2024.
