MicroStrategy has added 21,550 bitcoins to its holdings in a massive $2.13 billion purchase, marking one of the largest institutional bitcoin acquisitions of 2024. The company paid an average of $98,783 per bitcoin in a series of purchases between December 2-8, according to an SEC Form 8-K filing released December 9.
The acquisition brings MicroStrategy’s total bitcoin holdings to 423,650 BTC, purchased at an average price of $60,324 per bitcoin, representing a total investment of $25.6 billion. The company now holds approximately 2% of Bitcoin’s total circulating supply.
To fund the purchase, MicroStrategy issued 5,418,449 new shares through an at-the-market (ATM) offering, increasing its diluted share count to 275,642 thousand shares. The company retains $9.19 billion in remaining ATM capacity for potential future acquisitions.
“MicroStrategy has acquired 21,550 BTC for ~$2.1 billion at ~$98,783 per #bitcoin and has achieved BTC Yield of 43.2% QTD and 68.7% YTD,” Michael Saylor, MicroStrategy’s Executive Chairman, announced on X (formerly Twitter). “As of 12/8/2024, we hodl 423,650 $BTC acquired for ~$25.6 billion at ~$60,324 per bitcoin.”
Market Impact
The large-scale purchase coincided with significant market activity. Trading volumes surged from $36.5 billion to peak at $149.2 billion on December 5, with three consecutive days seeing volumes exceed $70 billion. Despite the size of the purchase, Bitcoin’s price remained relatively stable, trading between $93,629 and $103,900 during the acquisition period.
The purchase occurs amid increasing institutional interest in Bitcoin, with several spot Bitcoin ETF applications under SEC review. Recent daily ETF inflows have ranged from 3,000 to 7,500 BTC, highlighting growing institutional demand for cryptocurrency exposure.
Performance Metrics
MicroStrategy reported a BTC Yield of 43.2% from October 1 to December 8, 2024, and 68.7% year-to-date. This company-specific metric measures the change in bitcoin holdings per fully diluted share, indicating that bitcoin acquisition has outpaced shareholder dilution.
The company’s stock performance reflects the impact of its Bitcoin strategy:
- 2024 YTD: +525.39%
- 2023: +346.15%
- Pre-Bitcoin strategy (2019): +11.65%
Market Analysis
The sustained large-scale purchases by MicroStrategy demonstrate ongoing institutional interest in Bitcoin at higher price levels. The premium pricing of their acquisition, averaging $98,783 per bitcoin including fees and expenses, suggests limited liquidity for institutional-size purchases, which could impact future large-scale bitcoin investments.
The purchase price represented a premium to market prices during the acquisition period, highlighting the challenges of executing large institutional purchases without significant market impact.
Looking ahead, MicroStrategy maintains significant capacity for future bitcoin acquisitions through its remaining ATM facility. However, the company faces ongoing considerations including potential shareholder dilution, exposure to bitcoin price volatility, and increasing institutional competition from pending Bitcoin ETF products.
