MSTR’s recent Bitcoin purchase was funded through the sale of common stock to support its crypto strategy.
Shares of Strategy (MSTR) fell by over 8% today, driven by a sharp decline in Bitcoin prices. The cryptocurrency dropped to its lowest point in a year, affecting crypto-related stocks. This setback extended the downward trend that has plagued MSTR for months.
Bitcoin saw a significant drop, falling below important technical levels over the weekend and early this week. The drop in Bitcoin’s value rippled across the market, particularly impacting shares tied to crypto. MSTR’s shares were among the hardest hit, continuing a longer-term slide.
As Bitcoin dipped below $75,000, other major crypto platforms like Robinhood and Circle also saw losses. The correlation between Bitcoin’s price and the performance of crypto stocks remains strong, highlighting the market’s sensitivity. As Bitcoin’s price slipped below key support levels, MSTR’s stock felt the pressure, extending its losses.
Strategy Inc, MSTR
Strategy holds over 713,000 Bitcoins, which were purchased at an average price of $76,000 per coin. The recent drop in Bitcoin’s price has resulted in unrealized losses for the company. Despite these challenges, Strategy has made it clear it won’t sell its Bitcoin holdings.
Chairman Michael Saylor reaffirmed the company’s long-term strategy. “We will continue to accumulate Bitcoin, even in a weak market,” Saylor said. This approach has been a consistent theme for the company, as they see Bitcoin as a key asset despite short-term losses.
Earlier this week, Strategy acquired 855 additional Bitcoins for $75.3 million. The purchase was made at an average price of $87,974 per coin, just before Bitcoin’s price dropped below $75,000. The company’s Bitcoin holdings now total 713,502 BTC, with an average cost of $76,052 per coin.
Strategy has funded recent Bitcoin purchases through stock sales, continuing its capital-raising efforts. Last week’s Bitcoin purchase was smaller than previous buys, but still part of the company’s strategy to expand its crypto holdings. Despite Bitcoin’s recent slump, Strategy remains committed to increasing its Bitcoin position.
At the time of writing, Bitcoin’s price stands below $74,000, marking its lowest level in a year. This drop follows a retreat of more than 40% from Bitcoin’s all-time highs. MSTR’s shares have followed the trend, now trading at $128.87, down from their 52-week high of $450 per share.
