The publicly traded company that holds the most bitcoin (BTC) in the world, MicroStrategy, currently has multi-billion dollar unrealized gains in the digital currency.
MicroStrategy 's bitcoin reserves are currently valued at $20 billion (USD), double the value at which it was acquired.
The company has acquired the property through multiple purchases over the past four years for an average price of USD 10 billion. The most recent purchase was made a month and a half ago.
The price of Bitcoin reaching $80,000 today made this milestone possible.
This is because the average purchase price per bitcoin of the reserves held by MicroStrategy is USD 39,464, as can be seen in the following graph.
The green circles on the chart represent the times when the company made bitcoin purchases. Meanwhile, the green dotted line indicates its average purchase price and the blue one the digital currency's market price.
MicroStrategy runs a Bitcoin investment strategy known as “ dollar cost averaging (DCA).” This involves recurrent purchases of an asset with upside potential to average out the cost of acquisition, rather than trying to identify a market bottom to enter.
From 2022 to 2023, MicroStrategy's Bitcoin investment was at a loss. This led some to believe that the company had missed the opportunity to make a profit the previous year when its investment was valued at twice its purchase price.
However, with Bitcoin on a bullish trend over the past year, MicroStrategy's holdings are not only back in the black, but are now at an all-time high for the company. However, this is not motivating him to sell at the moment, which reflects the bullish sentiment of Michael Saylor, the company's founder.
In fact, Saylor commented today that he believes the published chart “needs more green dots, ” suggesting the company will continue to make bitcoin purchases in the near future.
MicroStrategy sees a bullish future for bitcoin
MicroStrategy's strategy is motivated by bullish expectations for digital currency at least for the next decade.
Saylor has commented that, according to his analysis, “the price of bitcoin will grow faster over the next 10 years.”
With such certainty in mind, it seems prudent for this company to position itself to take advantage of this predicted price increase.
The company's president also says that anyone can benefit from investing in BTC. “If you're going to invest in bitcoin, a short time horizon is four years, a medium time horizon is ten years, and the right time horizon is forever,” Saylor recently opined.
Furthermore, as long as MicroStrategy maintains this strategy , "holding" BTC (it currently has more than 1% of the BTC that exist and may exist), it contributes to the price increase because it prevents these coins from increasing the supply in the market.
