Investing
MicroStrategy's Shares Rise in Premarket as Bitcoin Crosses $26,000
Published:
Last Updated:
MicroStrategy’s shares rose 3% on Tuesday after Bitcoin’s price recovered above the $26,000 level after days of sluggish performance. Microstrategy is the largest publically-listed corporate holder of the flagship cryptocurrency, with 158,800 BTC listed as part of its assets, valued at over four billion dollars.
MicroStrategy, a Bitcoin Proxy?
MicroStrategy’s shares rose 3% in premarket trading on Tuesday after Bitcoin staged a notable rebound of about 4%, breaking above the $26,000 threshold for the first time since Friday.
At the time of writing, MicroStrategy’s stock was trading at around $353 per share at the market pre-open, while BTC’s price was changing hands at $26,144. BTC’s upswing propelled several altcoins, with Ethereum, Binance Coin, XRP, Dogecoin, and Cardano surging from 1.5%-2.5%.
The correlation between MicroStrategy’s share price and Bitcoin is unsurprising, given that Michael Saylor’s firm is the cryptocurrency’s largest corporate holder. The company is seen as a Bitcoin proxy, functioning almost like a makeshift Bitcoin exchange-traded fund (ETF).
As of August 1, 2023, MicroStrategy holds 158,800 Bitcoins. Its total purchase price for the biggest crypto asset is more than $4.5 billion, with an average price of about $29,672 per coin.
In what seems to be its plan, MicroStrategy has become synonymous with Bitcoin over the years and currently holds nearly 0.7% of the total Bitcoin supply. Bitcoin’s future total supply is capped at 21 million.
Corporate Crypto Investors Welcome New Accounting Rules
MicroStrategy’s aggressive Bitcoin approach has undoubtedly benefited the company’s business and stock performance. This week, the firm and other big corporate BTC holders received an additional boost.
Notably, crypto companies and businesses holding significant investments in Bitcoin have welcomed the long-awaited accounting rules to gauge the value of their crypto holdings following a unanimous vote by US accounting policymakers.
Under the new guidelines, companies that hold or invest in cryptocurrencies will be obliged to report their holdings at fair value, allowing them to register the most up-to-date value of an asset, including rebounds after a price decline. Although the new rules will likely add volatility to the earnings of companies heavily exposed to crypto, the capability to record price recoveries is expected to bring significant improvements over current accounting practices, companies stated.
This article originally appeared on The Tokenist
Want to Retire Early? Start Here (Sponsor)
Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?
Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
