US Markets
Tuesday, March 19th, 2024 8:41 pm EDT
Key Points
- MicroStrategy’s shares fell alongside the price of bitcoin on Tuesday, with the stock declining by 5.67% and dropping as much as 18% earlier in the day.
- The company purchased an additional 9,245 bitcoins for about $623 million, using net proceeds from a recent private offering of convertible senior notes and excess cash. This follows a similar move last week when MicroStrategy bought 12,000 bitcoins for close to $822 million. The company now holds a total of 214,246 bitcoins.
- Bitcoin itself experienced a decrease, falling below $63,000, approximately $10,000 below its recent record high. MicroStrategy typically trades in tandem with bitcoin, and key catalysts such as spot bitcoin exchange-traded funds and the upcoming “halving” event in April have influenced the performance of both the cryptocurrency and MicroStrategy’s stock. Despite its original focus as a provider of enterprise software, MicroStrategy has shifted its strategy to aggressive bitcoin acquisitions since 2020 and announced plans to prioritize bitcoin development, leading its stock to surge 124% this year compared to bitcoin’s 50% increase. However, both MicroStrategy and bitcoin experienced a downturn last week as investors took profits.
MicroStrategy’s shares experienced a significant decline on Tuesday, mirroring the downward movement of the price of bitcoin, as the company continued to increase its holdings of the cryptocurrency. Initially dropping as much as 18%, the stock ultimately closed lower by 5.67%. This decline coincided with MicroStrategy’s purchase of an additional 9,245 bitcoins for approximately $623 million, funded through net proceeds from a recent private offering of convertible senior notes and excess cash. Last week, the company made a similar move, acquiring 12,000 bitcoins for nearly $822 million after a debt sale, bringing its total bitcoin holdings to 214,246. Meanwhile, bitcoin itself experienced a decrease, dropping below $63,000, approximately $10,000 below its recent record high. MicroStrategy’s stock typically moves in line with the cryptocurrency, reflecting its status as a proxy for bitcoin’s performance. Key factors such as the introduction of spot bitcoin exchange-traded funds and the upcoming “halving” event in April, which reduces the bitcoin mining reward, have contributed to the resilience of the cryptocurrency and stocks associated with it. MicroStrategy, originally a provider of enterprise software, has shifted its focus to aggressive bitcoin acquisitions since 2020 and has recently announced plans to prioritize bitcoin development, leading its stock to surge 124% this year, outpacing bitcoin’s 50% increase. However, both MicroStrategy and bitcoin experienced a downturn last week as investors took profits, contributing to the stock’s recent decline.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/03/19/microstrategy-largest-corporate-holder-of-bitcoin-drops-as-much-as-18percent.html
