Investing.com -- Microstrategy, Inc. (NASDAQ: NASDAQ:MSTR) shares fell 5% as the broader cryptocurrency market experienced a downturn, with bitcoin touching a low of $90,198. The decline in Microstrategy's stock followed the company's announcement of acquiring an additional 2,530 bitcoins.
The software company, known for its substantial bitcoin holdings, used proceeds from a recent sale of its class A common stock to fund the purchase. Between January 6, 2025, and January 12, 2025, Microstrategy sold approximately 710,425 shares, generating around $243 million, less sales commissions. Following the sale, Microstrategy has about $6.53 billion worth of shares still available under its current Sales Agreement.
Microstrategy's latest bitcoin acquisition was made at an average price of roughly $95,972 per bitcoin, totaling approximately $243 million. As of January 12, 2025, Microstrategy and its subsidiaries hold around 450,000 bitcoins, purchased at an average price of $62,691 per bitcoin, including fees and expenses. The total investment in bitcoin now stands at approximately $28.2 billion.
The company's strategy of leveraging its equity to increase its bitcoin holdings has been a key driver of its stock performance. However, the recent decline in bitcoin's value has directly impacted Microstrategy's market valuation, leading to the observed 5% drop in its share price.
Investors are closely monitoring the volatility of bitcoin prices, as Microstrategy's financials are significantly tied to the cryptocurrency's market performance. The company's aggressive investment in bitcoin has been a point of interest and concern among shareholders and analysts alike, given the high level of risk associated with the digital asset's price fluctuations.
Microstrategy has not provided a comment from an analyst regarding this recent stock movement. The company's stock behavior continues to reflect the inherent volatility of its bitcoin investment strategy, underscoring the risks associated with such a concentrated position in cryptocurrency.
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