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Michael Saylor's Strategy, which has not bought any Bitcoin for the last 10 weeks, went on a spending spree and bought 4,603 BTC worth $370M at an average price of $80,318 per coin. This is Strategy's first purchase since June 22nd.
The stock was up nearly 3% at around $130 on the news and Strategy used the remaining proceeds of the stock offering to repurchase approximately $151.8 million worth of its preferred STRC shares. The company also added around $30 million to its cash balance.
With this last round of Bitcoin purchases, Strategy brings its total holdings to 845,050 BTC, which at current prices is greater than $67B or approximately 4% of the total circulating supply of Bitcoin.
The purchase comes at an opportune time, given that the cryptocurrency spent the last 10 months or so steadily declining in value to a low of $58,500 in late June, some 53% below the all-time high. And while Strategy stuck to its "we will never sell" mantra, the stock was in fact sold four times over the summer in order to meet various obligations. For a company whose entire existence is based on constant accumulation of the digital currency, that was an unusual and highly-watched instance of capitulation.
Bitcoin skyrocketed on August 21st and broke the $79,000 per Bitcoin barrier for the first time in nearly three months, catapulting up 23%+ in a single trading session. After plummeting to $58,500 in late June — a whopping 53% decline from Bitcoin's record price — that dragged Strategy's treasuries below cost basis, ultimately forcing the shares to plummet in value over the intervening months.
This is also significant in light of Florida's growing Bitcoin economy. Miami and its financial community are big supporters of Bitcoin, and have been for years. Mayor Francis Suarez has long been a proponent of the cryptocurrency, and it is a growing sector of the city's economy. The world's largest corporate holder of Bitcoin has validated the long-term thesis of Bitcoin advocates in South Florida who have been arguing that Bitcoin will reach $80,000 and beyond in the years to come.
This new round of buying by MSTR will of course fuel the debate regarding the efficacy of Saylor's model of raise cash and spend all of it to buy and hold BTC for ever. It clearly hasn't broken. Yet.
