MicroStrategy’s Bitcoin stash soars to new heights as the cryptocurrency’s price surges beyond $30K, resulting in impressive profits for the company.
MicroStrategy, a business intelligence firm, is now seeing profits from its Bitcoin holdings for the first time since July. With the recent surge in Bitcoin’s price, surpassing $30,000, MicroStrategy’s 158,245 BTC is now worth $4.847 billion, resulting in a $132 million profit. The company started buying Bitcoin in 2020 and has been increasing its purchases as the price of the cryptocurrency recovered from losses caused by the US Federal Reserve’s interest rate policies and high-profile crypto bankruptcies.
MicroStrategy’s co-founder and chairman, Michael Saylor, has been vocal about Bitcoin’s outperformance compared to traditional assets since the company adopted its cryptocurrency-buying strategy in August 2020. He shared data showing Bitcoin’s returns versus the S&P 500, Nasdaq, gold, silver, and bonds.
While MicroStrategy is currently enjoying profits from its Bitcoin investment, there are concerns about whether the price of Bitcoin will continue to rise in the future. Since May 2022, Bitcoin has struggled to establish a clear bullish momentum after crossing $30,000, and there are signs of a potential correction. The daily relative strength index (RSI) for Bitcoin is at its most overbought levels since January 2023, indicating a possible drop in price or consolidation.
If a correction occurs, Bitcoin’s price could head towards its 50-day exponential moving average (50-day EMA) near $27,720 in November. On the other hand, if $30,000 remains a strong support level, Bitcoin could reach the next resistance area at $32,000.
From a fundamental perspective, the potential approval of a Bitcoin exchange-traded fund (ETF) in the US could serve as a strong bullish catalyst. CryptoQuant suggests that if a Bitcoin ETF is approved, it could increase the Bitcoin market’s net capitalization by $155 billion. This could potentially push the price of Bitcoin to $50,000 to $73,000 in 2024.
Despite these possibilities, MicroStrategy has stated that it will stay on its BTC course even if a Bitcoin ETF is approved. The company remains committed to its Bitcoin investment strategy.
It’s important to note that this article does not contain investment advice or recommendations. Investing in cryptocurrencies involves risks, and readers should conduct their own research before making any investment decisions.