While crypto assets like Ethereum (ETH) have been receiving most of the attention due to the upcoming upgrade called ‘The Merge‘, the Bitcoin network itself has been getting some headlines. First, the top cryptocurrency showed signs of a breakout and then dropped to $20,000 on September 13, indicating a volatile week. Second, despite huge losses in the latest quarterly report, software firm Microstrategy (NASDAQ: MSTR) has announced buying more Bitcoins.
Despite showing some promising signs, Bitcoin dropped to $20,000.
MicroStrategy has filed to sell up to $500 million in stock to buy more BTC.
MicroStrategy’s stock value has dropped by more than 50% so far this year.
MicroStrategy Doubles Down on Bitcoin Bet
MicroStrategy has made it clear that it is one of the strongest supporters of Bitcoin, having apportioned billions in capital towards the asset. It has time and again iterated that Bitcoin is an asset that will have a place in the global economy in the future, and this has been lauded by crypto enthusiasts. Last week, it filed to sell up to $500 million in a stock offering to purchase even more Bitcoin, showing that the bear market has not swayed its stance.
All of this has occurred despite the fact that the company’s strongest proponent of BTC, Michael Saylor, is no longer the CEO. It announced the separation of the CEO and Chairman roles. This came following a $1 billion loss as revealed in the second quarter financial results, because of the market rout. It goes to show that the company fundamentally has a strong conviction in the asset. Saylor remains an Executive Chairman.
The bear market and drop in Bitcoin’s price saw MicroStrategy taking a $917.8 million impairment charge. It holds 129,698 Bitcoins as of June 30, and the tanking of the cryptocurrency’s price also saw its stock value drop by a significant amount. So far this year, the MSTR stock has fallen by over 50%.
All in all, the sentiment surrounding Bitcoin seems to be changing slightly. Whether it consolidates into an improvement remains to be seen, but MicroStrategy certainly believes so.
Short-Term Hopes for Bitcoin
The market currently appears to be itching to break out of the slump it has been subject to this year — or at least investors are. Several assets have been in the green following months of heavy losses, and lifted by Ethereum’s Merge, investors are hoping for a strong end to 2022.
Institutional investors also seem to be optimistic about BTC. Fidelity, for instance, is considering offering Bitcoin to retail investors. Such moves indicate positive hopes for the asset in the short to medium-term future.