After the gains: The Bitcoin guru has returned to buying coins - what does it mean?
The world's largest corporate holder has resumed purchases after a break of about ten weeks, during which it even sold coins. Why is Michael Saylor's return considered an event that the entire market is watching, and what does it signal about the state of Bitcoin?
The company Strategy (formerly MicroStrategy) led by Michael Saylor announced this week that it has returned to purchasing Bitcoin after a break of about ten weeks, having acquired about 4,603 coins in the last week for about 370 million dollars.
This is a significant event for two reasons: Strategy is the world's largest corporate holder and serves as a "barometer" for the entire crypto market, and the current break was particularly unusual, as the company even sold coins during it. The return comes at a time when Bitcoin is trading between 78,000 and 80,000 dollars, following the recent rally.
With the latest purchase, Strategy now holds 845,050 Bitcoin coins, acquired at a total cost of about 63.7 billion dollars and at an average price of 75,412 dollars per coin. This accounts for about 4% of the total 21 million coins that will ever be mined, a holding that is currently worth about 66 billion dollars and reflects a "paper" profit of about 2.3 billion.
An interesting detail: the latest purchase was made at an average price of 80,318 dollars per coin, above the company's historical average price and even above the price that was in the market.
Strategy's model is based on a "flywheel": when MSTR stock trades at a premium to the value of the Bitcoin in the treasury, the company issues shares at a high price, buys more Bitcoin with the money, and increases the amount of coin per share. In a bear market, this premium was almost wiped out, and issuing shares became unprofitable, so the company stopped buying, sold a few coins, and strengthened the balance sheet.
The recent recovery in Bitcoin has brought the market value of MSTR closer to the value of its holdings again, which has reopened the window for fundraising and issuance. In other words, the return to buying is a sign that the financial engine is back in operation, even if only partially.
Strategy financed the purchase through the sale of shares: it sold about 4.5 million shares for about 602.8 million dollars. About 370 million were directed to Bitcoin, about 152 million to the repurchase of STRC-type preferred shares, and the remainder to dividends and cash reserves. It is precisely this dilution that led the investment firm Bernstein to recently cut the target price for the stock.
Saylor himself announced "net zero leverage," but it is important to be precise: this is a metric that the company defines itself, and it does not mean that it has no debt, as in practice it carries about 6.75 billion dollars in debt and about 15 billion dollars in preferred shares.
Saylor, who turned Strategy into a pioneer of "treasury companies," posted the caption "We are back" on the X network at the end of the week, a familiar hint at the resumption of purchases.
Every large purchase of his is carefully examined by traders and investment managers, as it adds real demand and signals confidence.
Saylor's return is an encouraging signal for the market, but one must keep things in perspective: Strategy's stock is still about 60% lower than its level a year ago, and the company bought above its average. For the investor, the conclusion is that even the largest player in the field is still recovering and has not returned to the glory days.
