MicroStrategy, the first-ever large company to decide to regularly invest in cryptocurrency, may soon own 1% of all bitcoins ever created.
MicroStrategy wants to own every hundredth bitcoin
MicroStrategy has just announced another bond offering worth $500 million. He wants to buy bitcoins for this amount. Importantly, if he buys cryptocurrencies soon, i.e. at current prices, he will have over 210,000 BTC. This is 1% of the entire bitcoin supply that will ever be created (21 million BTC).
From the company's announcement on Wednesday, we learn that the bonds are to be repaid in 2031. Their interest rate and initial conversion rate have not yet been determined.
MicroStrategy intends to use the net proceeds from the sale of the notes to purchase additional bitcoin and for general corporate purposes
– the company said in the document.
Earlier this month, MicroStrategy completed the sale of $700 million in convertible notes maturing in 2030. It also recently added 12,000 BTC to its balance sheet, purchased for approximately USD 69,000 per coin, which increased the company's total resources to as much as 205,000 BTC.
So far, investing in BTC has been very profitable for the company. Less than a week after the last purchase, the price of bitcoin was already over $73,200. At the time of writing these words, 1 BTC costs USD 73,400, which means a price jump of 11.5% on a weekly basis and 1.3% since yesterday. MicroStrategy's unrealized profit already amounts to USD 8 billion.
The perfect strategy on the BTC market? DCA!
The MicroStrategy example shows how smart Dollar-Cost Averaging (DCA) is in the market. In practice, it is about averaging the purchase cost. In other words, the investor buys bitcoins regularly and hodls them. Thanks to this, he does not risk investing all his capital at once. In the case of a bull market, as we can see from the above data, the average purchase price begins to “go away” quickly, which shows the effectiveness of this strategy.
