The price of bitcoin - here the quotation in real time - has seen a dramatic increase in the past two months. With prices soaring, MicroStrategy's $ 425 million investment between August and September is already paying off.
Data posted on Twitter by cryptocurrency researcher Kevin Rooke indicates that MicroStrategy made $ 100 million in profits from its 38.250 bitcoin reserve two months after its investment. Looking ahead, MicroStrategy has earned just $ 78 million from its commercial operations over the past three and a half years.
The MicroStrategy example
In August, US-based business intelligence firm MicroStrategy invested $ 250 million of its excess bitcoin liquidity to defend its capital value from a fragile dollar.
The company bought an additional $ 175 million in bitcoin in September, bringing its total holdings in BTC to $ 425 million. It should be noted that the actual activity of MicroStrategy has nothing to do with cryptocurrency.
However, the publicly traded company now recognizes bitcoin as its main reserve asset, basically a hedge against inflation. At the time MicroStrategy initiated the investment by purchasing bitcoin, company CEO Michael Saylor described the stock as "an example of MicroStrategy's embrace of virtual technologies."
In short, a clear change from Saylor's previous opinion on the main cryptocurrency. The CEO said seven years ago that he believed bitcoin was on the verge of extinction. Shares of MicroStrategy have also risen since the company announced the purchase of bitcoin.
MSTR now has a market valuation of $ 1,7 billion. Although MicroStrategy has huge exposure to bitcoin, owning stock in the company does not offer investors indirect exposure to the cryptocurrency.
Increased participation by multi-billion dollar associations
Ever since MicroStrategy made the bold move on bitcoin, enthusiasts believed it would give other companies the confidence to move forward with bitcoin investments.
So far, only a few publicly traded companies have converted their share of cash into bitcoin, including Square, Mode Global Holdings and Stone Ridge. Bitcointreasuries.org claims that public companies now hold 786.059 BTC, equivalent to $ 10,8 billion at current prices.
While there has yet to be a large-scale exodus to cryptocurrencies, more companies could switch to bitcoin after MicroStrategy's impressive gains. Meanwhile, a year ago, no one could have imagined that these high-profile companies would openly bet on bitcoin. Yet, here we are. This certainly marks a turning point for cryptocurrency.
