In a recent tweet, Saylor said that his firm bought about 17,000 BTC. Including the previous 21,000 token purchases, the firm currently holds around 38,000 BTC in total.
"On September 14, 2020, MicroStrategy completed 16,796 additional bitcoin purchases with a total purchase price of $ 175 million. To date, we have purchased a total of 38,250 bitcoins for a total purchase price of $ 425 million, including fees and charges."
As a business intelligence software firm, MicroStrategy is not normally associated with cryptocurrency. But last month the company announced its revised treasury strategy to tackle uncertain economic conditions.
In Press briefing, the company talked about the downsides of holding cash during these times. Accordingly, they think holding BTC instead of cash is a better bet for the company.
“This investment reflects our belief that Bitcoin, the world's most widely used cryptocurrency, is a reliable store of value and an attractive investment asset with longer-term appreciation potential than holding cash … MicroStrategy It recognized Bitcoin as a legitimate investment asset that could be superior to cash, and therefore made Bitcoin the main holding in its treasury reserve strategy. "
The news brought a boost to cryptocurrency advocates who have long been blamed for Bitcoin being a pyramid scheme.
As a company on the NASDAQ list of MicroStrategy, it adds an air of legitimacy to Bitcoin. However, some observers criticized the move, especially considering that Bitcoin could not close above the critical $ 12,000 level.
Bitcoin daily chart with volume. (Source: tradingview.com)
Bitcoin as a Hedge? Not All Shareholders Are Convinced
While this is a boost for Bitcoin in terms of legitimacy, some have suggested that MicroStrategy's approach to aggravating BTC is something wrong to do.
A Twitter user He pointed out that this left the company seriously short of cash. Moreover, it was a move that did not make much sense, with ongoing expenses requiring payments in dollars.
The ~ $ 420 million you reported as cash balance is now in Bitcoin.
How you will pay 80 million to 100 million dollars (USD) in quarterly operating expenses (leases, wages for your 2,528 employees)! ??!
You will convert Bitcoin to USD every time, right ?! pic.twitter.com/X498dATTEf
– Uncle Jack (@ UncleJack123) 15 September 2020
Moreover, according to Saylor's figures, the average net cost of BTC purchases reached $ 11,111. And while the price of Bitcoin remains below this level, Saylor's strategy will continue to cause turmoil.
However, the obvious corporate interest in Bitcoin still brings welcome relief to an area struggling with fraud charges.
So much so, Barry Silbert, CEO of Digital Currency Group, who owns Grayscale, joked that this was the start of a "purchase race" between the two companies.
There seems to be some sort of bitcoin buying race between MicroStrategy and MicroStrategy. @Films
Let the game begin
– Barry Silbert (@barrysilbert) 15 September 2020
Grayscale made headlines recently after reports that the firm bought more Bitcoin than its mining output rate.
Analysis of the situation showed that BTC purchases are important. However, the reported "inflow streams" came from "old Bitcoin" sent by hedge funds.