MicroStrategy has officially announced that it has adopted Bitcoin as its main reserve.
The company is traded on the Nasdaq under the symbol MSTR and is the largest independent publicly traded business intelligence company with nearly 2,400 employees.
The announcement also reveals that has acquired 21,454 BTC for a total of approximately $ 250 million, including fees and expenses, consistent with its capital allocation strategy already announced with the publication of its second quarter 2020 financial results on July 28, 2020.
MicroStrategy's services, founded in 1989, are used by many Fortune Global 500 brands, and the company ended 2019 with $ 486 million in revenue and $ 34 million in profit.
The CEO of MicroStrategy Incorporated, Michael J. Saylor, said:
“Our investment in Bitcoin is part of our new capital allocation strategy, which seeks to maximize long-term value for our shareholders. This investment reflects our belief that Bitcoin, as the most widely adopted cryptocurrency in the world, is a trusted store of value and an attractive investment asset with more potential for long-term appreciation than holding cash. Since its inception more than a decade ago, Bitcoin has emerged as a significant addition to the global financial system, with features that are useful to both individuals and institutions. MicroStrategy has recognized Bitcoin as a legitimate investment asset that can be superior to cash and has consequently made Bitcoin the primary stake in its treasury reserve strategy. "
Microstrategy's strategy with Bitcoin
Saylor also explained that it took months for the company to develop its new capital allocation strategy, and the choice of bitcoin was driven by a confluence of macro factors that are affecting the global economic outlook and the corporate outlook, particularly with regard to the risks involved. in your corporate treasury program.
In the end, the company concluded that factors such as the economic and public health crisis, government financial stimulus measures, quantitative easing (QE), and global political and economic uncertainty could have a real significant depreciation effect. in the value of long-term fiat currencies and many other conventional assets.
In considering the alternatives, MicroStrategy analyzed the distinctive properties of Bitcoin and eventually came to believe that investing in BTC could provide not only a reasonable hedge against inflation, but also the prospect of higher returns compared to other investments.
In this regard, Saylor commented:
“We view Bitcoin's global acceptance, brand recognition, ecosystem vitality, network dominance, architectural resilience, technical utility, and community spirit as persuasive evidence of its superiority as an asset class to those who They seek a long-term store of value. Bitcoin is digital gold: harder, stronger, faster, and smarter than any money that came before it. We expect its value to increase with advances in technology, expanding adoption and the network effect that has fueled the emergence of so many top killers in the modern era. "