MicroStrategy CFO Recommits the Firm to Maintain Bitcoin Accumulation Strategy

Phong Le, the Chief Financial Officer of MicroStrategy Incorporated, said the company will not relent in its bullish acquisition of Bitcoin (BTC) as its Treasury Reserve Asset (TRA).

The company, primarily a business intelligence, software, and cloud services provider, adopted Bitcoin as its preferred asset to diversify its excess cash flow, making its first investment back in August 2020 and has since been accumulating the digital currency.

With over 124,391 Bitcoin units on its balance sheet as of the end of December 2021, MicroStrategy ranks as the institutional investor with the largest amount of Bitcoin holdings, ahead of Square Inc which rebranded to Block Inc last year, and American electric vehicle giant Tesla Inc which accumulated $1.5 billion worth of the coin in the first quarter of 2021.

The year opened to a massive price correction for Bitcoin, which slumped to a 6-month low of $32,951. Despite this bearish outlook, Phong Le said the company is not planning to taper down its acquisition approach. 

“Our strategy with bitcoin has been to buy and hold, so to the extent we have excess cash flows, or we find other ways to raise money, we continue to put it into bitcoin,” 

This statement resonates with earlier comments from Michael Saylor, the company’s founder and CEO, who personally holds over 17,000 units of Bitcoin. MicroStrategy purchased more than $2 billion worth of Bitcoin last year with funding raised from the sales of debt instruments. Phong Le noted that the firm’s acquisition will continue, even though he remains uncertain if it will spend more money on Bitcoin than it did last year.

“We’re constantly looking at other ways to be additive to our shareholders as it relates to bitcoin,” Le added.

Beyond Bitcoin’s recent price mishaps, MicroStrategy’s stock is also taking the plunge alongside other prominent tech stocks. In the longer term, the firm believes it will be amongst the biggest beneficiaries for holding Bitcoin, which supposedly provides immunity against inflation.

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MicroStrategy Further Accumulates Bitcoin Holdings to 114,042 after additional 5,050 Purchase

MicroStrategy Incorporated, a Nasdaq-listed software and cloud service provider, have doubled down yet again on its Bitcoin acquisition Pursuits, committing a new $242.9 million to purchase a new batch of the digital asset.

MicroStrategy’s Bitcoin Portfolio

Announced by Michael Saylor, the iconic Chief Executive Officer of MicroStrategy, the latest acquisition added approximately 5,050 BTC into the company’s reserve. Saylor said the firm now holds as many as 114,042 Bitcoin Units, all valued at $3.16 billion at an average price of about $27,713 per bitcoin, according to the current price.

Since MicroStrategy made its foray into the digital currency ecosystem last August, the firm has often reiterated its unrelenting plans to store Bitcoin as its Treasury Reserve Asset continually. The firm strongly believes that the US Dollar and other fiat monetary systems are flawed and are unsustainable amidst a slew of dwindling global economic policies.

The firm has not sold any of its Bitcoin holdings since it resumed its accumulation journey. Despite two sharp market corrections experienced thus far this year, Michael Saylor has led the firm to take advantage of price slumps to bolster the firm’s Bitcoin portfolio at a notable discount.

The Bitcoin adoption by MicroStrategy has positively impacted the company’s revenue outlook and share price as it reported positive revenue growth for the second quarter. The company’s revenue came in at $125.4 million, increasing 13.4% over the same period last year.

Example to Other Institutional Investors

Beyond its obvious role in promoting the superiority of Bitcoin as an investable asset, Michael Saylor has also come off as a mouthpiece, advocating for other institutional investors on Wall Street to consider allocating a portion of their reserve asset to Bitcoin. Amongst the many beliefs MicroStrategy maintains is that acquiring Bitcoin as a strategy to hedge against the impacts of monetary inflation will be an invaluable move for firms to preserve wealth.

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Metromile Reveals Bitcoin Purchase Worth $1 Million In Q2

Metromile digital pay-per-mile vehicle insurance company based in San Francisco revealed in its filing with the U.S. Securities and Exchange Commission (SEC) that it bought Bitcoins worth $1 million as part of its treasury reserve in June 2021.USA - Metromile sign at the Company's headquarters

Twitter handle @MacroScope17 reported the news about Metromile’s Bitcoin purchase. The tweet spurred several people to talk about the purchase, stating how significantly small the Bitcoin purchase was for the digital insurance platform and pay-per-mile auto insurer.

The report showed that Metromile has invested just 0.5% of its cash in Bitcoin, and it would have been better if the amount was at least 5-10%. The second-quarter financial results of the insurance company indicated that Metromile had $202.584 million in cash during that time of purchase.

However, such purchases mean that crypto adoption is increasing, and companies are going a step further and taking the risk to invest in Bitcoin.  

In May, Metromile stated that it would soon buy additional Bitcoins and announced that it would introduce an option in which policyholders pay for insurance and receive payment for eligible and approved insured claims in Bitcoin.

Metromile CEO Dan Preston talked about the development and said:

“We believe in the transformative potential of blockchain technology. We are still in the early days of realising how this shift to decentralised finance and cryptocurrency will create enduring advantages in insurance. Still, we believe that offering bitcoin as an option for premium and claims payments would be an important first step.”

Why Firms Are Big on Bitcoin?

Blockchain and Bitcoin technology have created unique opportunities for different individuals (traders and investors) and sectors (real estate, finance, etc.). With the rise in cryptocurrency awareness and widespread adoption, institutional investors increasingly enter the crypto landscape. Many businesses and companies have already started accepting Bitcoin and other cryptocurrencies as payment mediums for goods and services.

Metromile Nasdaq-listed insurance firm joins a rising list of firms that have bought Bitcoin for their balance sheet. A few months ago, public companies like MicroStrategy, Square, Tesla, and others purchased Bitcoins as part of their treasury reserve. MicroStrategy made headlines by putting more than 90% of its treasury assets into Bitcoin.

What appears like a smart move for them may not translate into a good one for another firm. But for these companies, are not speculating and have been quite targeted in their decision-making. Of course, these public companies have used their treasury capital to make a bet on Bitcoins to add value to their shareholders.

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MLB team will HODL Bitcoin received from suite sales, says president

Dave Kaval, president of Major League Baseball’s Oakland Athletics, says the ball club will be HODLing any Bitcoin that fans pay for luxury seats at the team ballpark in the San Francisco Bay Area. 

In an interview with Bloomberg on Friday, Kaval said no baseball fans had yet taken advantage of the opportunity to buy a full season, six-person suite for the home season for 1 Bitcoin (BTC) since the deal was first announced on March 15. Though the A’s club president said he was still hopeful “two or three” people will buy tickets for the ten suites available, he also clarified that any crypto received from purchases wouldn’t be converted into fiat right away.

“We’re gonna hold it,” said Kaval. “We’re believers in [Bitcoin] and hopefully it continues to go up and maybe we can find some big free agents with some of the proceeds.”

The BTC price dipped to $51,000 since the initial sales announcement, meaning crypto users who purchased the suite at just the right time could have saved more than $13,000 compared to the regular full season fiat price of $64,800. The price of the crypto asset has since returned to more than $57,000.

Kaval said part of the reason for the change to selling the tickets in crypto was the baseball club offering “something unique and different.” Though he said the A’s would not be accepting other tokens like Ether (ETH) or Dogecoin (DOGE) this week, there is the possibility of doing so in the future.

“We’re focused on just Bitcoin for now, but I think if it catches on, and we get interest, we are open.”

Bitcoin sales for the suites will still be accepted before April 1, when the Oakland A’s first game is scheduled against the Houston Astros. Though the status of the game may still be subject to change depending on COVID-19 cases in the state, at the time of publication, roughly 9,400 baseball fans are expected to be allowed at the A’s RingCentral Coliseum on Thursday — less than 20% of the 63,132 people when the venue is at full capacity.

Many Major League Baseball players have also become involved in the non-fungible token market. Last month, former MLB player-turned artist Micah Johnson sold $1 million worth of tokenized art in just one minute on Nifty Gateway.