MicroStrategy Buys 21,550 BTC for $2.1 Billion, Extending Holdings to 423,650 BTC

The share performance of MicroStrategy and Bitcoin’s price have aligned similarly, with the firm’s stock price changing alongside the cryptocurrency’s.

MicroStrategy co-founder Michael Saylor propeled the firm’s Bitcoin acquisition by buying an additional 21,550 BTC  between December 2 and December 8, 2024, at a value of $2.1 billion. The company’s total is  423,650 BTC,  estimated at  $41.5 billion based on the coin’s current price.

The company acquired these coins with funding by issuing 5,418,449 shares at an average price of $98,783. With this latest move, MicroStrategy holds over 2% of the total Bitcoin supply.

It has invested roughly $25.6 billion into Bitcoin since its first purchase. These consistent buys in the last few years show that MicroStrategy is determined to continue its purchase strategy, including the notable buys at almost all major market drawdowns.

 Bitcoin Holdings and Market Impact

Following the latest purchase,  the firm’s shares are up more than 480% this year, primarily because of the appreciation of Bitcoin’s price. Nevertheless, investors are still wary of additional Bitcoin price corrections.

Notably, there has been an interdependency between the share performance of MicroStrategy and the volatility of Bitcoin, with the firm’s stock price changes primarily pegged to the cryptocurrency’s market movements. Moreover, MicroStrategy uses strategic financial methods to fund its Bitcoin purchases.

Such methods include leveraging debt instruments and share sales, such as the $21 billion market share sale program. The company’s focus on Bitcoin mirrors broader optimism in the market about its prospects.

Bitcoin recently crossed the $100,000 threshold, and projections indicate it could maintain its bullish momentum. According to DeFi platform Derive, the probability that Bitcoin could top $150,000 by January 2025 is as high as 6%.

 Bitcoin’s Price Increase Propels Stock Price for MicroStrategy 

Meanwhile, the price of Bitcoin has shot up by close to 40% in the last couple of months alone, causing a surge in the value held by MicroStrategy. This spike has shot the firm’s unrealized profit to $17 billion to showcase some long-term value in its BTC purchase strategy.

The firm began its BTC purchase strategy in 2020 and has spent over $23 billion on acquisitions since then. This has kept MicroStrategy as the leading institutional Bitcoin holder. 

Per data from MSTR Tracker, this market movement indicates the beginning of a “euphoria” phase, which is expected to propel BTC’s price rally into 2025.

 Other Companies Follow MicroStrategy

 Interestingly, MicroStrategy’s leadership in corporate Bitcoin acquisition has inspired other companies to explore similar strategies. For instance, Bitcoin miner Riot Platforms has made its first strategic acquisitions by issuing a $500 million convertible note offering.

The move indicates a growing interest in incorporating BTC-focused strategies into diversified corporate investment approaches. These recent events prove that corporate firms will play a key role in BTC price long-term prospects.

While profitable in the short term, Market analysts remain divided over whether the firm’s strategy will remain profitable in the long term.

 MicroStrategy’s Strategic Vision

 The continued success of MicroStrategy’s strategy underlines an innovative approach to leveraging Bitcoin as a core asset. With Bitcoin still volatile and market sentiment not fixed, the company’s strategic debt financing, share sales, and long-term market focus continue to show how adaptive traditional financial strategies can be in crypto markets.

Despite concerns about risks, MicroStrategy’s investments continue to set benchmarks for institutional cryptocurrency adoption. With Bitcoin’s value rising, institutions ramp up their purchase activity as they remain confident that the leading cryptocurrency remains a haven investment.

Meanwhile, data from the on-chain analytics platform CryptoQuant shows that institutional interest in BTC remains strong despite the intense selling pressure from retail holders. This is evident in the positive net flow recorded by US spot BTC ETFs, which is now the eighth successive day.

BlackRock’s IBIT recorded the largest inflow at $394.07 million, while BitWise’s BITB recorded the biggest outflows at $39 million. Nevertheless, crypto fear and greed remain in extreme greed region, suggesting optimism among crypto investors.

BTC currently trades at $94,856, down 2.9% in the last day, per on-chain data.