MicroStrategy's Bitcoin conviction remains strong
MicroStrategy, the business intelligence platform, has reported a Q1 2023 profit of $94 million, largely due to a one-time income tax benefit of $435.2 million. So, it’s true that MicroStrategy’s Bitcoin conviction remains strong despite fluctuations. The firms also generated $121.9 million in revenue, up 2.2% from last year’s period. This strong performance was attributed to the firm’s core business model and strategic Bitcoin investment.
The Bitcoin Investment Strategy
Micro Strategy continues to invest in Bitcoin despite short-term price fluctuations. In Q1 2023, the firm purchased an additional 7500 BTC, bringing its total holdings to 140,000 BTC at an average cost of $29,803. The firm’s CEO, Phong Lee, stated its strong conviction in Bitcoin as a strategic investment. Lee also noted that the short-term movements of BTC do not impact the firm’s core business.
Michael Saylor’s prediction
Michael Saylor, the Bitcoin advocate, and MicroStrategy Chairman, also expressed his confidence in the firm’s Bitcoin investment strategy. He is calling it the Right Strategy to outperform the market. Saylor predicted that investors would exit their positions very soon in crypto assets that are under the microscope in the regulatory environment.
Saylor predicted that investors would soon exit their positions in crypto assets. They are “under the microscope in the regulatory environment,” leading to a flow of capital into Bitcoin.
Reduce Leverage
MicroStrategy’s CFO, Andrew Kang, noted the firm’s effort to reduce its leverage by repaying its $161 million Bitcoin-backed loan from the now-collapsed Silverage Bank. The firm also released all of the Bitcoin pledged to secure the loan. Furthermore, he stated this was an important and strategic transaction for the firm and its liability management goals.
Bitcoin Integration
MicroStrategy began investing its cash reserves into Bitcoin on March 5, 2021, purchasing 91,064 BTC. The firm has since integrated Bitcoin Lightning into its corporate email address and is developing a Bitcoin layer-2 Lightning Network-based Software as a Service tool for corporations.
Conclusion
MicroStrategy’s Bitcoin conviction remains strong despite fluctuations. Its continued focus is on growing its business intelligence software while acquiring Bitcoin for the future, despite short-term price fluctuations. MicroStrategy remains committed to its strategic investment in Bitcoin. They believe it will continue to outperform the market over the long term.