MicroStrategy, the enterprise business organization renowned for its optimistic position on Bitcoin (BTC), has seen a significant surge in its stock price, reaching its highest level in the last two years.
According to statistics sourced from Yahoo! Finance, the shares of the technology business concluded trading on Black Friday at a price over $500, a threshold that has not been seen since December 2021.
Currently, MicroStrategy has a market capitalization of $7.55 billion.
MicroStrategy's strategic choice to retain substantial quantities of Bitcoin has shown to be a profitable maneuver.
Although the firm initially incurred a quarterly loss, its stock price saw a twofold increase over a span of one month.
MicroStrategy's founder and chairman, Michael Saylor, started the accumulation of Bitcoin in August 2020 as a means of safeguarding against inflation, given the company's substantial holdings in the cryptocurrency.
This is the reason why we have an optimistic outlook for the next 12-month period. The interviewee said that there would be a rise in demand and a contraction in supply, which is a phenomenon of considerable significance in the context of Wall Street's historical records.
MicroStrategy saw an upward trajectory in its financial performance during the course of the year.
In April, the company's Bitcoin assets saw positive returns when the value of Bitcoin exceeded $30,000.
By acquiring an additional 1,045 units of Bitcoin, the total quantity held by the entity reached 140,000 units. Consequently, the average cost of acquiring this digital asset decreased to $29,803 per unit.
Despite incurring a $24 million Bitcoin impairment charge in its second-quarter financial report, MicroStrategy managed to regain profitability as an organization.
The dominant publicly listed corporation, which holds Bitcoin as an asset, persisted in its extensive acquisition of BTC, amassing a total of 152,800 coins valued at over $4.4 billion.
It is noteworthy that the equities of firms having exposure to Bitcoin had superior performance compared to the cryptocurrency itself, which had already seen an 87% surge in value during the current year.
The company known as Microstrategy continues to exist. MicroStrategy's latest quarterly report, which was published in early November, revealed a net loss of $143.4 million. This loss is more significant than the $27 million loss disclosed during the same period in the previous year.
Nevertheless, the corporation persisted unwaveringly in its pursuit of acquiring Bitcoin, procuring an additional 6,067 units of the cryptocurrency at a cost of $167 million.
MicroStrategy now exercises influence over around 0.75% of the entire circulating quantity of Bitcoin, owing to its substantial holdings.
It is noteworthy to mention that the Microstrategy shares are anticipated to have positive effects as a result of the impending Bitcoin halving event.
The phenomenon of Bitcoin halving takes place at regular intervals of around four years and is an inherent feature of the Bitcoin system.
The term "bitcoin halving" denotes the decrease in the pace of bitcoin creation and subsequent allocation to miners as a reward for confirming transactions. The halving process has been specifically designed to effectively manage inflation and restrict the quantity of bitcoins available in the market.
The occurrence of halving events has substantial consequences for the supply and demand dynamics of Bitcoin, eventually exerting an influence on its price.
The decrease in the issue of new coins results in a scarcity phenomenon. As the number of BTC tokens being introduced into the market falls, the overall supply diminishes.
Berenberg estimates that there exists a significant positive connection of roughly 90% between the stock price of Microstrategy and the price of Bitcoin. Consequently, it is anticipated that Microstrategy's stock will have a concurrent upward movement with Bitcoin.
