Bold investments or recklessness? MicroStrategy continues to bet on Bitcoin

MicroStrategy continues to invest heavily in Bitcoin, despite a net loss of $53 million in the first quarter of 2024. This strategy raises questions about the impact on the Bitcoin market and long-term profitability.

MicroStrategy maintains its commitment to Bitcoin

We all know about MicroStrategy's increased interest in Bitcoin investments. He acquired 122 additional Bitcoin in April 2024 for an amount of 7.8 million dollars. This latest acquisition brings MicroStrategy's total Bitcoin holdings to 214,400 BTC.

Certainly, these massive Bitcoin acquisitions appear to be bold. However, they come as the company recorded a net loss of $53.1 million. This represents $3.01 per share.

MicroStrategy's revenue also fell 5.5% from the first quarter of 2023, reaching $115.2 million. The loss in value of digital assets amounts to $191.6 million, a consequence of the volatility of the cryptocurrency market.

Massive Bitcoin purchases despite devaluation

During 2024, MicroStrategy acquired a total of 25,250 Bitcoin for an amount of 1.65 billion dollars. This represents an average cost of $65,232 per part. Despite this aggressive buildupthe value of the company's digital assets dropped to $5.07 million.

If MicroStrategy had adopted the new digital asset fair value accounting standard, its Bitcoin assets would be valued at $15.2 billion.

MicroStrategy Misses S&P 500, Reports Losses

One significant impact of these net losses is that MicroStrategy missed the opportunity for inclusion in the S&P 500, which could have enhanced its credibility and attractiveness to investors.

MicroStrategy's action decreased by 3.3% after the announcement of the results for the first quarter of 2024. Certainly, the 65% rise in the price of Bitcoin in the first quarter initially helped to push the stock higher. But the latter has since fallen.

Is this strategy sustainable in the long term? Only time will tell !