1. Home
  2. News
  3. Bitcoin news
  4. Microstrategy announces it will double down on Bitcoin strategy

Microstrategy announces it will double down on Bitcoin strategy

Photo of: Nathan VDH
by Nathan VDH

MicroStrategy, the U.S.-based software company that recently purchased several million dollars in Bitcoin (BTC), stated that it will purchase more and reiterated that BTC is its “primary cash reserve asset”.

In a call for third-quarter 2020 earnings, the company said its “investment plan” for the coming quarter involved “using Bitcoin as its primary cash reserve asset” and “purchasing additional Bitcoin with excess cash, subject to market conditions and business needs”.

This initiative is justified by the fact that the Company ended the last financial quarter with a reserve of “$52.7 million in cash and no debt”.

MicroStrategy’s Chief Financial Officer, Phong Le, said the decision was part of its “new cash reserve policy, whereby we will retain excess capital beyond our needs for managing the business and for purchasing equipment and capital, primarily in Bitcoin.

Phong Le told shareholders: “You should expect us to buy even more Bitcoin because we are generating cash beyond what we need to run the business on a day-to-day basis.

The company also confirmed the current status of its holdings in BTC, stating that it has “approximately” 38,250 BTC (US$519 million), which it purchased for an “aggregate price” of approximately US$11,111 per BTC. At 09:07 UTC, BTC is trading at $13,575 USD and is up 3% in one day and 11% in one week. The price has also increased by 25% in the last three months.

Le also added that his company has “seen significant and unexpected benefits” from its bitcoin purchasing strategy, which has “improved the company’s image in the market,” which has attracted the interest of potential customers.

Last month, MicroStrategy’s CEO, Michael Saylor, stated that the company had “no plans to sell” its Bitcoin holdings “in a very short period of time”. He tweeted today the total number of Bitcoin he held personally: 17,732 BTC.