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Proportions of MicroStrategy Inc. (NASDAQ:MSTR) fell more than 8.5% on Monday, marking a rough debut to its nascent stage among the Nasdaq 100.
The best software company and corporate Bitcoin (CRYPTO: BTC) has struggled recently, recording its fifth losing session in the last six sessions and plunging over 37% since its all-time high last month.
Why Does MicroStrategy Fail?
On Monday, MicroStrategy announced it was selling $561 million in common stock to buy an additional 5,262 Bitcoins at an average price of $106,662 per coin. This brings the company's total Bitcoin holdings to a whopping 444,262 BTC.
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Yet the size and timing of this purchase raised eyebrows among traders and analysts.
The latest Bitcoin purchase was Michael Saylorleast so far. It's a stark contrast to the bold, big-ticket acquisitions that have defined its crypto strategy thus far.
The average price paid for the new Bitcoin stash is about 12% higher than current levels. Even more impressively, the price is above the December 17 all-time high of $106,151 per Bitcoin – an unusual move for a company known for strategically buying dips.
The judges did not hold back. Peter Schiffwell-known Bitcoin skeptic, took a jab at Saylor on X, saying:
“It seems like you are running out of firepower to continue holding Bitcoin. Also, not only is it your smallest purchase, but the first time your average purchase price has been higher than the market price on the Monday to you disclose the purchase.”
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Meanwhile, the market reaction reflected growing unease.
“$MSTR continues to look pretty heavy,” wrote the Markets & Mayhem account on X. “The 'infinite money glitch' isn't really a glitch at all. Speculators who love beta.”
A Risky Game of Leverage
MicroStrategy's deep ties to Bitcoin have been its crown jewel and Achilles' heel. With over $41 billion worth of Bitcoin on its balance sheet as of December 2024, the company is inextricably linked to the ever-changing movements of the cryptocurrency market.