Strategy MSTR Buys Bitcoin at 123000 Just Before Price Crash
Strategy MSTR, a notable name in the software industry transitioning into cryptocurrency investments, recently acquired Bitcoin at a price of $123,561. This purchase occurred just before a significant market downturn on October 10, 2023, where Bitcoin’s value plummeted to approximately $103,000.
Details of the Acquisition
Regulatory filings revealed that Strategy purchased 220 Bitcoin, amounting to a total investment of $27.18 million. This acquisition marks a critical moment as it coincided with a historic flash crash affecting the cryptocurrency market.
Market Impact and Analysis
- On October 10, the cryptocurrency market experienced severe volatility.
- Nearly $20 billion in leveraged positions were lost during this sudden downturn.
- The flash crash was triggered by U.S. President Donald Trump’s announcement of a 100% tariff on Chinese goods.
- This announcement reignited concerns of an escalating trade conflict between the United States and China.
As a result of this market upheaval, Bitcoin was trading around 15% below the average cost of Strategy’s recent acquisition shortly after the purchase. Even in the context of a market rebound, Strategy could have bought Bitcoin at prices ranging from $110,000 to $115,000, representing a potential discount of 7% to 10% compared to their acquisition price.
Strategy’s Bitcoin Holdings
Following this recent purchase, Strategy MSTR currently holds a total of 640,250 Bitcoin, with an average purchase price of $73,000 per token. The company’s journey into Bitcoin began in 2020, reflecting its strategic pivot towards cryptocurrency investment.
Bitcoin Performance Overview
In assessing Bitcoin’s recent performance, it is noteworthy that the cryptocurrency has experienced a decline of 2.21% over the past 12 weeks. Analysts typically refrain from providing price targets or ratings for Bitcoin, given its inherent volatility.
In summary, Strategy MSTR’s decision to buy Bitcoin shortly before a market crash highlights the unpredictable nature of cryptocurrency investments and the broader economic factors influencing these digital assets.
