MicroStrategy’s Bitcoin investment could return as prices soar in Q1. The software giant has invested more than $4 billion in bitcoin, with an average price per coin of $29,817.
able #microstrategy‘S #bitcoin Investing profitable again?The average purchase price is $29,817 https://t.co/vGr4F5hL0V
— Kyptos (@azcoinnews) April 1, 2023
Buying Bitcoin was a portfolio diversification move by MicroStrategy, which has experienced massive volatility resulting in a quarterly paper profit of as much as $3.1 billion in bull market conditions, while a paper loss of just $100 million was due to the fall.
Bitcoin rallied around 73% in the first quarter, its biggest quarterly gain in two years, after falling 64% last year amid a series of scandals and bankruptcies in the industry. Bitcoin hit a local high of $29,171 on Wednesday (March 29), just below MicroStrategy’s average buy price of $29,817.
Despite the regulatory risks associated with the crypto market, MicroStrategy continues to invest in Bitcoin. On March 27, the company announced that it had purchased an additional $150 million in bitcoin and paid off a $205 million bitcoin-backed loan.
MicroStrategy CEO Michael Saylor is a staunch supporter of bitcoin, describing it as a better store of value than gold. He also believes that Bitcoin is an effective inflation hedge, which investors are increasingly interested in due to unprecedented government stimulus plans.
The success of MicroStrategy’s Bitcoin investment has attracted many large companies and institutions to follow suit. Tesla, for example, invested $1.5 billion, while Square, the payments company founded by Jack Dorsey, invested $50 million.
It remains to be seen whether MicroStrategy’s investment will ultimately turn a profit as bitcoin prices continue to fluctuate. For now, however, the company’s decision to invest heavily in cryptocurrencies appears to be paying off.
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according to Kyptos