MicroStrategy purchased an additional 7,002 Bitcoin, worth approximately $414.4 million

While BTC remained below $59,000, MicroStrategy wowed the crypto community with another massive Bitcoin buy, up to 7,002 Bitcoin, worth approximately $414.4 million, at an average price of $59,187.

MicroStrategy has announced another massive Bitcoin purchase

As of today, the company now owns 121,044 BTC, worth up to $3.57 billion. It was acquired at an average price of $29,534 and included capital appreciation from previous coins.

Michael Saylor, CEO of enterprise data analytics company MicroStrategy, announced Monday via a Twitter post as below:

In August 2020, MicroStrategy announced it would use Bitcoin as a treasury reserve asset, citing the digital currency as a reliable store of value and attractive investment with potential longer-term profitability than holding cash.

In addition, the company has drawn attention to the introduction of unprecedented stimulus measures by governments to combat COVID-19 as a catalyst for potential inflation and subsequent depreciation of fiat. Since then, MicroStrategy has almost continuously been buying Bitcoin every quarter. The company currently holds about 0.64% of the total circulating supply of BTC.

Bitcoin didn’t budge on this announcement as it continued to move sideways just above the $57,000 level. BTC attempted a partial recovery from Monday’s violent sell-off. Typically, day traders lose when the Bitcoin price goes down and profit when the price goes up. However, that is not necessarily the case with MicroStrategy.

According to earnings conference transcripts released last month, Phong Le, president, and chief financial officer of MicroStrategy, said that Bitcoin holdings are classified as indefinite-lived intangible assets under applicable accounting rules.

This means that at any time after the redemption if the fair value or market value of Bitcoin falls below its book value, the company will need to recognize the loss charges. These loss charges can then be used to offset the company’s corporate tax liability legally.

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