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Tysons software company's bitcoin holdings now worth $3B
Sydney Lake //February 8, 2021//
Tysons software company's bitcoin holdings now worth $3B
Sydney Lake// February 8, 2021//
Following Tesla’s announcement that it had purchased $1.5 billion in bitcoin, Tysons-based business software company MicroStrategy Inc. — which has converted hundreds of millions in holdings to bitcoin now worth more than $3 billion — saw its stock price jump by 29% on Monday.
By Monday at 4 p.m., the Nasdaq reported that MicroStrategy’s stock price had risen to $1,041. Both MicroStrategy founder and CEO Michael Saylor and Tesla founder Elon Musk have been advocates of public corporations using cryptocurrency for treasury holdings.
Congratulations & thank you to @elonmusk & @Tesla on adding #Bitcoin to their balance sheet. The entire world will benefit from this leadership.https://t.co/FVTepBqAI2
— Michael Saylor⚡️ (@saylor) February 8, 2021
According to a filing with the U.S. Securities and Exchange Commission, Tesla purchased the cryptocurrency for “more flexibility to further diversify and maximize returns on our cash.”
MicroStrategy first started its bitcoin conversions in summer 2020 and by December 2020 held more than 70,000 bitcoin, worth more than $1.1 billion at the time. Those 70,000 bitcoin are worth more than $3 billion as of Feb. 8.
“We believe the proactive management of our balance sheet, combined with the improved revenue and profitability performance of the company, have been significant factors in the recent appreciation in our stock price,” Saylor said in a December 2020 statement.
In August 2020, MicroStrategy announced that it had converted $250 million from its cash holdings into more than 21,000 bitcoins, making it one of the first public companies to use cryptocurrency for cash holdings. Saylor said MicroStrategy would keep its bitcoin holdings in its corporate treasury reserve — which he said would be the principal holding in its treasury reserve strategy. The company in September 2020 then announced it had purchased $425 million worth of bitcoin.
By December 2020, MicroStrategy closed a convertible debt offering by raising $650 million, which it said it plans to use to increase its bitcoin holdings.
