MicroStrategy posts Q3 loss after writing down BTC value

MicroStrategy began amassing Bitcoin in large quantities as a hedge against inflation in 2020. Nonetheless, this strategy appears to have failed at present. MicroStrategy decreased the token’s value and incurred a loss during the third quarter of this year.

MicroStrategy is a publicly traded software maker with the largest holding in Bitcoin. Writing down the value of the token has brought a loss of $143.4 million in comparison to $27 million for the previous year. The per-share price has moved up from $2.39 to $10.09, but that does not necessarily paint a brighter picture with the losses coming up.

Michael Saylor, the co-founder and former chief executive officer of MicroStrategy, has reportedly accumulated BTC worth ~$5.5 billion. Thereby, it turns the struggling company into a Bitcoin proxy for investors in equity. 

Bitcoin written off by MicroStrategy is more than 50%. Reports surfacing have established that MicroStrategy had 158,000 Bitcoins as of October 31, 2023. Their valuation comes to $29,586 per token at that moment. Further, it reflects the total accumulation of $4.69 billion.

BTC has now climbed to $35,371.91 as of the time of drafting this article. This is a jump of approximately 2.77% in the last 24 hours. It is also an increase of 3.11% in the last 7 days.

While MicroStrategy has suffered a loss by writing down the value of Bitcoin in its records. There is speculation that the company may continue to accumulate more tokens in the time to come. This has been hinted at by Andrew Kang, who said that there are plans in the pipeline to have more Bitcoin on the register. The Chief Financial Officer made this statement during a post-earnings conference call.

There are splits within the community of investors and analysts, with most of them trying to comprehend if the plan of MicroStrategy will eventually work. This increases the likelihood that the SEC will ultimately approve the application for the Spot Bitcoin ETF – Exchange Traded Fund. Acceptance of this application will facilitate direct Bitcoin investment. MicroStrategy’s share price has increased threefold since the middle of 2020, compared to a 40% increase in the S&P 500 Index. However, it may be appropriate for the company to consider how much Bitcoin they should pursue.

Michael is attempting to make an argument in favor of investing in the shares of MicroStrategy instead of investing in the US Spot Bitcoin ETF. Saylor has said that there would be fees to invest in the Spot Bitcoin ETF, something that they avoid to enable people to get sufficient exposure to Bitcoin.

Moving forward, Michael Saylor has plans to sell some of his shares in the first four months of 2024 in connection with expiring options. Crypto enthusiasts have started sharing their views and appreciating the fact that there has been a giant, unrealized gain in BTC.