As the price of Bitcoin, along with many other cryptocurrencies, continues to plunge, Michael Saylor’s MicroStrategy (MSTR) is sitting at an unrealised loss of over $1 billion.
Taylor began purchasing Bitcoin through MSTR in August 2020, when its price was a little under $12,000. Subsequent investments (through junk bonds and convertible note sales) worth an approximate $4 billion brought the company’s overall Bitcoin holdings to 129,918 tokens. However, at its current market price of around $22k, the investment’s real value sits at around $2.79 billion. This means that MSTR’s Bitcoin endeavour is currently at an unrealised loss of around $1.2 billion.
According to Taylor, real problems would only ever arise if Bitcoin’s price plummets to a mere $3,500, which is why he dismissed talks of a ‘margin call’ (i.e. when an investor deposits further cash or securities to cover possible losses) last month.
Despite this hypothesis from its CEO, as well as the fact that the relevancy of unrealised gains/losses is largely only ‘realised’ once deciding to sell, the company’s shares have naturally been hit hard in the past week, as Monday saw them drop a hefty 24.32%.