Microstrategy buys the Bitcoin DIP and attracts criticism from analysts

Microstrategy buys the Bitcoin DIP and attracts criticism from analysts

Microstrategy bought more Bitcoin in the middle of the volatility of the cryptom market, since the company's market leader further doubles the asset - although some market analysts have questioned the decision.

The business intelligence and software company bought another 480 Bitcoin (BTC) for around $ 10 million-an average price of $ 20,817 per bitcoin, according to A Wednesday acceptance .

Microstrategy now holds almost 130,000 BTC ($ 2.61 billion), which has acquired it for an average price of $ 30,664 for around $ 4 billion.

The company has far the largest BTC stock of all listed companies; Tesla is the second largest with 42,902 BTC ($ 862 million).

The price of Bitcoin was around $ 20,000 at 1:30 p.m., according to data compiled by block works-a decrease of 3.1 % compared to 24 hours ago, which caused Microstrategy to get 35 % into the red figures.

Madeline Hume, Senior Research Analyst at Morningstar said that the recent purchase of Microstrategy shows that the company is ready to buy at various price levels.

The company bought almost 7,000 BTC in Last October and November, while Bitcoin was traded around $ 60,000. Michael Saylor, CEO of Microstrategy, announced in April that he bought another 4,167 BTC for around $ 190 million-an average price of around $ 45,700.

"This purchase does not freely freed Saylor from the hot chair because the price of Bitcoin continues to stagnate," Hume told Blockworks. "Microstrategy still remains at almost $ 1.4 [Billion] under water on its Bitcoin reserves."

Microstrategy believes that Bitcoin recovery is close to

Edward Moya, a senior market analyst by the foreign exchange company Oanda, said it was quite clear that Microstrategy put all-in on Bitcoin and search for as much capital as possible to buy the dip.

"The quick increase in value before the record high of last year and the recent decline shows that Microstrategy failed to capitalize on the way up and to find protection when things became ugly," he said to block works. "Investors who are looking for a crypto commitment should not consider Microstrategy as a good vehicle because they have proven to be daring with their portfolio management."

Fawad Razaqzada, financial market analyst at Stonex, said the purchase signals signaling that Saylor believes that the Bitcoin desolation is coming to an end and a recovery is imminent.

"I agree with this point of view to a certain extent," added Razaqzada. "However, it feels a bit like a game of chance, because the prices have not yet stabilized to give them trust that a deep has already been reached. I hope that the investors who hold the shares do not deter this."

According to Google Finance, Microstrategy's share price at 1:30 p.m. ET was $ 176.46, which corresponds to a decrease of 5.2 % compared to yesterday. The share has fallen by around 68 % since the beginning of the year.

Ben McMillan, Chief Investment Officer at IDX Digital Assets, said that although the recent purchase of Microstrategy is small compared to its earlier purchases, it corresponds to larger so -called "whale wallets", which are striving for value purchases at the current level of Bitcoin.

"However, this message comes together with the latest news from the [Three Arrows Capital] restructuring, which may mean a more forced sale of Bitcoin," added McMillan. "So the market is still waiting for the other major liquidation events to be lurking around the corner."

The recent purchase of Microstrategy takes place after SEC chairman Gary Gensler said in an interview with CNBC on Monday that Bitcoin was securities, but Bitcoin was a goods.

Saylor linked A video of the interview on Twitter and stated in a subsequent twein that "bitcoin Investment grade currency is ”.