The company posted a significant (paper) loss on its Bitcoin holdings amid the price collapse. Tesla was also affected.
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- MicroStrategy shares fell more than 20%.
- With Bitcoin below USD $23,000, MicroStrategy recorded losses on its BTC investment.
- It’s not alone: Tesla’s Bitcoin treasury also fell.
As we head into the cryptowinter, the investments of some big name holders of Bitcoin the biggest and most popular cryptocurrency in the world. It is a decentralized digital currency that enables users to make trustless peer-to-peer transactions. start to cool down.
MicroStrategy the enterprise software company and the largest institutional whale a term used to describe investors who have uncommonly large amounts of crypto, especially those with enough funds to manipulate the market. in the world. Bitcoin has seen its share price fall on Monday amid a steep pullback in the cryptocurrency cryptocurrencies are digital currencies that use cryptographic technologies to secure their operation. market. According to data from Yahoo! Finance The company’s shares, under the MSTR ticket, have plunged 23% since its close refers to the closing price; similar to the same term used in stock trading. on Friday.
The actions of MicroStrategy are trading at USD $155 this Monday, after closing slightly above USD $200 on Friday. The price represents the lowest level for the company’s shares since September 2020.
The stock drop comes amid a severe correction a correction is a pullback of an asset’s price of at least 10% to adjust for over-valuation. in the cryptocurrency market. Bitcoin retreated below USD $23,000 on Monday morning, as the global market an area or arena, online or offline, in which commercial dealings are conducted. capitalization of digital currencies fell to less than $1 trillion, a level not seen since early 2021.
Tesla and MicroStrategy lose USD $1.5 billion
The bearish bite has also affected the very gypsy investment of Bitcoin de MicroStrategy . Led by Michael Saylor, MicroStrategy has been buying Bitcoin at an accelerated pace since August 2020, accumulating almost 130,000 coins.
While the company began investing in the flagship cryptocurrency when it was trading near USD $12,000, overall, purchases have averaged USD $30,700 per BTC, a level well below the USD $23,300 at which it Bitcoin changes hands for editing time.
Following these figures, MicroStrategy has deployed some $3.9 billion over the past two years in pursuit of its strategy of accumulating Bitcoin . Taking into account an account is essentially a whose purpose is to track the financial activities of a specific asset/ that the main cryptocurrency sank to USD$22,900 this day, Saylor’s company recorded an unrealized loss of just over USD$1 billion.
According to data from Bitcoin Treasuries that loss in the holdings of Bitcoin se estima actualmente en alrededor de los USD $950 millones. Mientras tanto, MicroStrategy is not the only company that has bet on crypto and recorded losses on its BTC holdings in the face of the recent price decline.
Tesla the electric car manufacturer owned by Elon Musk, which has been bought more than 40,000 bitcoins during the The 2021 bull a person that is optimistic and confident that market prices will increase, this person is also known to be "bullish" about the market or price. market is in a very similar position. Spending of USD $1.5 billion Tesla to buy Bitcoin is now worth about $500 million less, and together, both whales have lost about $1.5 billion (on paper).
Crypto-related companies suffer from the fall
The collapse appears to be part of a broader trend seen in global equity equity is the funds that would be returned to a company's shareholders if all of the company's assets were dissolved and all debts were paid off in the event of liquidation. markets, in the face of macroeconomic headwinds, as noted by CoinDesk . The futures a futures contract is a standardized legal agreement to buy or sell a particular commodity or asset at a predetermined price at a specified time in the future. of the Nasdaq 100 have fallen by 2.8% and those of the S&P 500 are down 2.4%. However, amid this scenario, shares of companies linked to the crypto space seem particularly disadvantaged.
As reported by this news portal, the shares of the exchange businesses that allow customers to trade cryptocurrencies for fiat money or other cryptocurrencies. Coinbase is an American company that operates a cryptocurrency exchange platform. (COIN) and some cryptocurrency mining a process where blocks are added to a blockchain, verifying transactions. It is also the process through which new bitcoin or some altcoins are created. companies also wobbled pre-market on Monday. The shares of Coinbase fell by 8%. according to data from Yahoo! Finance while Marathon Digital digital technologies are these electronic tools that have the ability to generate, store or even process data. (MARA), Riot Blockchain a distributed ledger system. A sequence of blocks, or units of digital information, stored consecutively in a public database. The basis for cryptocurrencies. (RIOT) y Hut 8 (HUT) saw double-digit percentage drops.
The actions of MicroStrategy and these other companies in question have been recognized by traditional investors as indirect exposure to cryptocurrencies. It should be noted that the share price of Tesla also fell by almost 5% amid the bearish scenario in the markets.
Despite the grim cryptowinter outlook that has determined the cryptocurrency market for most of 2022, the CEO of MicroStrategy has reiterated its confidence in the acquisition strategy of Bitcoin and assured that the company has no plans to sell. Just a few days ago, Saylor shared some of the reasons why he believes that the price of Bitcoin will not go to zero, and will instead go up to $1 million. long-term.
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Article by Hannah Estefania Perez / DiarioBitcoin
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