Bitcoin goes mainstream

MicroStrategy doubles down, invests another $175M in Bitcoin

The mainstream firm made headlines in August when it announced that it had bought $250 million in BTC as an inflation hedge

Barely a month after pouring a quarter billion dollars into bitcoin, business intelligence firm MicroStrategy announced that it has purchased another $175 million BTC, bringing its total investment to $425 million.

In announcing its initial $250 million purchase on Aug. 11, CEO Michael Saylor said the investment was an inflation hedge, calling Bitcoin “a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash.”

MicroStrategy doubles down on Bitcoin
MicroStrategy doubles down (Photo: Twitter)

He cited the current global political and economic uncertainty, as well as the COVID-19 pandemic and the resulting massive stimulus programs launched by governments around the globe as a reason for that. 

“[T]ogether, these and other factors may well have a significant depreciating effect on the long-term real value of fiat currencies and many other conventional asset types, including many of the assets traditionally held as part of corporate treasury operations,” Saylor added at the time. 

Calling Bitcoin “digital gold, he added, “[t]his investment reflects our belief that Bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash.”

In addition to adding to its Bitcoin treasury reserve, Saylor announced in a Sept. 14 tweet that the company has completed a stock buyback announced on Aug. 11, purchasing $60.5 million  worth of its outstanding shares in a tender offer. That’s about 4.5% of the outstanding shares

The news of MicroStrategy’s investment was hailed as an important step in cryptocurrency’s acceptance march into the mainstream.

In August, Barry Silbert, the CEO of Digital Currency Group, commented, “MicroStrategy, a $1.2 billion company, just turned itself into a publicly traded bitcoin play. Smart.”

Today’s news comes as another big name in mainstream investing embraced Bitcoin. CNBC’s “Mad Money” host Jim Cramer told Morgan Creek Digital co-founder Anthony Pompliano on the Sept. 14 edition of The Pomp Podcast that he had begun investing in Bitcoin for his kids’ inheritance.

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Leo Jakobson, Modern Consensus editor-in-chief, is a New York-based journalist who has traveled the world writing about incentive travel. He has also covered consumer and employee engagement, small business, the East Coast side of the Internet boom and bust, and New York City crime, nightlife, and politics. Disclosure: Jakobson has put some 401k money into Grayscale Bitcoin Trust.