Business intelligence firm MicroStrategy has significantly increased its Bitcoin (BTC) purchases this month in response to the bullish sentiment following President-elect Donald Trump\u2019s victory on November 5. The company\u2019s recent acquisitions have pushed its total Bitcoin holdings to approximately $38 billion.<\/p>\n
On November 25, co-founder Michael Saylor<\/a> announced via social media that MicroStrategy had acquired 55,500 BTC between November 18 and November 24 for $5.4 billion.\u00a0<\/p>\n This purchase was funded by proceeds from a $3 billion convertible note issuance and sales of common shares, as detailed in a filing <\/a>with the US Securities and Exchange Commission (SEC).<\/p>\n Since beginning its Bitcoin acquisition strategy in 2020, Saylor has shifted from using corporate cash to a more complex funding model that involves selling convertible debt and shares.\u00a0<\/p>\n The latest convertible note was issued at a zero percent interest rate, reflecting lenders\u2019 confidence that MicroStrategy\u2019s stock will appreciate beyond the conversion price in the future.\u00a0<\/p>\n Jeffrey Park, a portfolio manager at Bitwise Asset Management, noted <\/a>that Saylor has effectively leveraged financial arbitrage within the corporate treasury structure, allowing MicroStrategy to borrow funds at virtually no cost.<\/p>\n Saylor also revealed <\/a>that MicroStrategy\u2019s treasury operations have yielded a substantial 59.3% in Bitcoin returns year-to-date, translating to a net gain of approximately 112,125 BTC for shareholders, or about 341 BTC per day.\u00a0<\/p>\n At a projected price of $100,000 per BTC, Saylor stated that this could mean an impressive $11.2 billion for the year, equating to roughly $34.1 million daily.<\/p>\n Since its foray into Bitcoin, MicroStrategy has acquired a total of 386,700 tokens, with an average purchase price significantly lower than its current market value<\/a>.\u00a0<\/p>\n The latest acquisitions occurred while Bitcoin prices were nearing all-time highs, with the company purchasing the new tokens at approximately $97,862 each, slightly above their current trading price.<\/p>\n However, this leveraged strategy has raised concerns among some analysts, particularly after MicroStrategy\u2019s shares<\/a> (MSTR) fell by 16% last Thursday.\u00a0<\/p>\n Critics warn that if Bitcoin\u2019s price declines sharply, the company\u2019s stock could suffer similarly, recalling the downturn in 2022 when the cryptocurrency market experienced significant losses.<\/p>\nAnalyst Warns Of Risks In Leverage Strategy<\/h2>\n