MicroStrategy’s Bitcoin Holdings Gain Profit as BTC Surpasses $30K

10:00 pm
October 23, 2023
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MicroStrategy, a business intelligence firm, has seen its Bitcoin holdings become profitable again as the price of BTC surpasses $30,000 for the first time since July. As of October 23rd, MicroStrategy held 158,245 BTC, which is worth $4.847 billion, resulting in a profit increase of approximately $132 million from the initial investment. This means that the firm is now making a profit of at least $130 per coin.

MicroStrategy Bitcoin holdings as of Oct. 23. Source: BlockchainCenter.Net

MicroStrategy’s Bitcoin Journey

MicroStrategy began buying Bitcoin in 2020 and increased its purchases in 2023 as the cryptocurrency market recovered from losses caused by the US Federal Reserve’s interest rate policy and various crypto bankruptcies. In September 2023, the firm acquired 5,444 BTC by raising capital, imitating their earlier approach that saw them buy around 12,333 BTC by raising funds earlier that year.

Michael Saylor, the co-founder and chairman of MicroStrategy, has shared data that illustrates Bitcoin’s outperformance compared to traditional assets since the company adopted its cryptocurrency-buying strategy in August 2020.

Bitcoin vs. S&P 500, Nasdaq, gold, silver, and bond returns since August 2020. Source: Michael Saylor/X

Will Bitcoin Continue to Rise in 2024?

Bitcoin has struggled to establish a consistent upward trend since crossing the $30,000 mark in May 2022. This pattern may repeat in the coming weeks, potentially pushing MicroStrategy’s BTC investment below its average buying price once again. Additionally, Bitcoin’s daily relative strength index (RSI) is currently at its most overbought levels since January 2023, suggesting a potential price drop or sideways consolidation based on technical analysis.

If a correction occurs, Bitcoin’s price could head towards its 50-day exponential moving average (50-day EMA) near $27,720 in November, representing a decrease of approximately 10% from the current levels. On the other hand, if $30,000 is maintained as the new support level, it could pave the way for the next major resistance area at $32,000, a level not witnessed since May 2022.

Bitcoin ETF Approval and Price Potential

From a fundamental standpoint, the potential approval of a Bitcoin exchange-traded fund (ETF) in the US serves as a strong bullish factor, indicating the possibility of a significant increase in the Bitcoin market’s net capitalization. According to CryptoQuant, an approved Bitcoin ETF could potentially boost the market’s net capitalization by $155 billion. The firm suggests that if this were to happen, Bitcoin’s price could reach $50,000 to $73,000 in 2024, which would be advantageous for MicroStrategy. However, even if a Bitcoin ETF is approved, the company has stated that it will continue with its current BTC strategy.

FAQs

What is MicroStrategy’s current Bitcoin holding?

As of October 23rd, MicroStrategy holds 158,245 BTC, worth $4.847 billion.

How much profit has MicroStrategy made from its Bitcoin investment?

MicroStrategy has made a paper profit of approximately $132 million from its Bitcoin investment.

When did MicroStrategy start buying Bitcoin?

MicroStrategy began buying Bitcoin in 2020 and increased its purchases in 2023.

What potential price levels are expected for Bitcoin in 2024?

CryptoQuant suggests that if a Bitcoin ETF is approved, the price of Bitcoin could reach $50,000 to $73,000 in 2024.

Will MicroStrategy continue with its BTC strategy if a Bitcoin ETF is approved?

Yes, MicroStrategy has stated that it will continue with its Bitcoin strategy even if a Bitcoin ETF gets approved.

Summary

MicroStrategy has seen a profit increase from its Bitcoin holdings as the price of BTC rises above $30,000. With 158,245 BTC worth $4.847 billion, the company has made a paper profit of approximately $132 million from its initial investment. MicroStrategy started buying Bitcoin in 2020 and increased its purchases in 2023. While a potential correction could push MicroStrategy’s BTC investment below its average buying price, the approval of a Bitcoin ETF in the US could boost Bitcoin’s price to $50,000 to $73,000 in 2024.


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