Bitcoin Just Got USD 250m Endorsement From Major US Company

US-based major business intelligence company MicroStrategy said it has purchased BTC 21,454 at an aggregate price of USD 250m, inclusive of fees and expenses.

Source: Adobe/Prostock-studio

“Our investment in Bitcoin is part of our new capital allocation strategy, which seeks to maximize long-term value for our shareholders,” Michael J. Saylor, CEO of MicroStrategy, was quoted as saying in the announcement.

According to him, this investment reflects their belief that BTC is a “dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash.”

“MicroStrategy has recognized Bitcoin as a legitimate investment asset that can be superior to cash and accordingly has made Bitcoin the principal holding in its treasury reserve strategy,” the CEO said.

He added that their decision to invest in BTC was driven in part by macro factors such as the economic and public health crisis precipitated by COVID-19, unprecedented government financial stimulus measures including quantitative easing adopted around the world, and global political and economic uncertainty.

“We believe that, together, these and other factors may well have a significant depreciating effect on the long-term real value of fiat currencies and many other conventional asset types, including many of the assets traditionally held as part of corporate treasury operations,” Saylor said.

Moreover, the company said it believes that BTC would not only be as a hedge against inflation, “but also the prospect of earning a higher return than other investments.”

“Bitcoin is digital gold – harder, stronger, faster, and smarter than any money that has preceded it. We expect its value to accrete with advances in technology, expanding adoption, and the network effect that has fueled the rise of so many category killers in the modern era,” the CEO stated.

“So there you go. We now have a publicly traded corporation that has decided to use Bitcoin as the reserve asset on their balance sheet. They aren’t in the Bitcoin business. They have no blockchain-based products. This isn’t a cash grab by adding “blockchain” or “crypto” to their name. This is a simple analysis done by a team that is worried about protecting their shareholder value in uncertain and chaotic times in the macro economy,” Morgan Creek Digital co-founder Anthony Pompliano wrote in his newsletter today.

Even more mind blowing –> $MSRT's BTC position represents 60% of their total cash and 54% of their net assets!

— ₿ailout (@betacrypto) August 11, 2020

Nothing wrong with that—but this is definitely (well timed, likely to work) bet-the-company risk-on; not conservative, sensible treasury management.

And unlike Kodak’s cynical (previous) pivot to crypto, at least they’re not shilling a shitcoin.

— Geoff Dudgeon (@geoffdudgeon) August 11, 2020

A publicly traded trust of 21,000 coins essentially. Soon the Company will label all other assets in their finance sheet as 'Other Assets'. 😂🔥

— —-Linear Trav—- (@3DNuts) August 11, 2020

At pixel time (14:31 UTC), BTC trades at USD 11,602 and is down by 3% in a day, trimming its weekly gains to 4%. The price is also up by 25% in a month and 2% in a year. 
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