Early last week, MicroStrategy announced that it had invested $25 million in Bitcoin. This purchase was made in January, according to Michael Saylor, CEO of a crypto podcast program “UpOnly”. He talked about the back story and reasons for doing so. His company wanted to accumulate as much BTC as possible, and the current total is 125,051 BTC over 2020 and 2021.
Established towards the end of the 1980s by Michael Saylor, MicroStrategy is a BI and software provider and publicly traded. Its reputation is now for its investment – $4.7 billion in BTC, which is part of its balance sheet.
Before the decision to invest in Bitcoin, it was known for being one of the most independent and largest publicly listed companies in the industry. In 2020 alone, its revenue intake was almost $480 million and an earnings rate of 8.29%. This was before interest, taxes and other cuts were calculated.
Discussing the company’s status in the podcast, Saylor said that he does everything to keep the company profitable. He enjoys doing the unusual and what is not scalable. He looks at different ways to reinvest profits instead of hiring more employees or advertising. MicroStrategy can be called a cash cow and grow its cash reserves.
This is a good thing to do, except that there is a good chance that this accumulated money could start losing value due to inflation. The Federal Reserve responded to the 2020 COVID pandemic by easing restrictions on financial markets. This pushed the stock market to new highs and resulted in speculative stocks soaring. Unlike other companies, the value of MicroStrategy was not rallying. In spite of this trend, Saylor says his company is working hard to stay afloat. The Bitcoin investment is like sailing with the wind and benefiting from it.