In recent months, instability has plagued the crypto sector. Digital currencies continue to rise and fall, causing panic across the crypto community.
Last week, it appeared the crypto market had regained stability. Several analysts believed the crypto market was gearing up for a bullish movement. Unfortunately, that is far from the truth.
MicroStrategy is one of the largest holders of Bitcoin in the crypto market. Unfortunately, the recent crypto bloodbath has caused its assets to diminish. According to recent news, MicroStrategy’s BTC Investment is down by over $850M.
MicroStrategy’s BTC Investment Plunges As Bitcoin’s Price Drops
Earlier today, Bitcoin lost its support at the $29,000 region and fell below $25,000. As a result, the Bitcoin investment of whale buyers has dipped.
Among them is Michael Saylor’s company, MicroStrategy, which is popular for buying Bitcoin. Reports ays the company has over 130,000 BTC.
According to Bloomberg, the aggregate purchase price for MicroStrategy’s BTC is about $30,700 per BTC. As of then, the company had bought over $3.97 billion worth of Bitcoin.
The sharp descent of Bitcoin means MicroStrategy’s BTC investment has recorded negative returns. This is because MicroStrategy bought most of its BTC holdings above the $25,000 mark.
Microstrategy Investors Unperturbed By Crypto Market Crisis
Now that Bitcoin has dropped below $25,000, let’s look back at the statement of MicroStrategy’s CFO. In May, Phon le, the Chief Financial Officer of MicroStrategy, stated that;
“Bitcoin’s price would have to be about $21,000 before MicroStrategy would need a margin call. We shall add more BTC to our collateral package before it drops to 50% of our entry price ($42,000).”
Currently, Bitcoin is testing the $23,000 price zone, which is just $2000 away from $21,000. However, investors are not moved by the recent drop in the price of Bitcoin.
This is because the company has huge liquidity collateral. Hence, the company believes this will cushion the effect of the loss.
However, the company stated last month that it would never sell its Bitcoin holding. Its CEO, Michael Saylor, remains bullish on crypto despite the crypto market crisis. Last month, he noted that Bitcoin would go into millions.
In other news, the shares of MicroStrategy dropped by over 21% last week. Entering the new week, it has plunged by 76% from its all-time high in November.