As a seasoned analyst with years of experience in the dynamic world of finance and technology, I find myself intrigued by MicroStrategy’s strategic shift towards Bitcoin. Having closely followed the evolution of this trend since its inception, I must admit that the company’s moves have been nothing short of audacious and visionary.
The premium on MicroStrategy’s net asset value (NAV) relative to its Bitcoin holdings has soared to a level not seen since February 2021, currently sitting at a multiple of 2.5.
The NAV premium indicates the difference between MicroStrategy’s market value and the current value of its Bitcoin holdings. Currently, MicroStrategy is valued at approximately $37.14 billion, whereas its 252,220 Bitcoins are worth around $15.1 billion in terms of their market capitalization.
The costliness of this asset is reflected in its Mastershare (MSTR) value as well. Notably, the ratio between its current MSTR price and that of Bitcoin is at a record high of 0.0030, which is the highest it’s been since they started purchasing Bitcoin back in 2020.
Since Michael Saylor, our CEO, shifted the company’s direction towards Bitcoin in 2020, we have grown to be the biggest publicly traded company with Bitcoin holdings.
The business has been strategically accumulating Bitcoins by securing funds via stock offerings and convertible bonds. This move has led to an expansion of the company’s Bitcoin holdings per share, now standing at 0.0012. However, it’s important to note that this growth has been slightly affected by the issuance of additional shares, a process known as dilution.
2024 saw MSTR surpass Bitcoin’s performance, with a return of more than 240% since the debut of Bitcoin spot ETFs on the stock market in January.
The improvement here is approximately eightfold greater compared to Bitcoin, which has decreased by 16% since it reached its highest point in March. By October 8th, MicroStrategy’s stock was worth about $200, whereas the price of Bitcoin remained fairly consistent.
Additionally, the firm unveiled a metric named “Bitcoin Return on Capital,” which monitors the fluctuations in their Bitcoin assets relative to their issued stocks.
In Q2 of 2024, the yield climbed to 5.1%, a rise from 4.4% in the preceding quarter, suggesting it’s expanding its Bitcoin reserves at a quicker pace than it’s adding new shares.
As a researcher, I’ve discovered that my organization has significantly expanded its Bitcoin holdings over the past two months. Specifically, we’ve acquired approximately 18,300 Bitcoins, marking our largest such purchase since the beginning of 2021.
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2024-10-11 20:36