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MicroStrategy (MSTR) outperforms leading traditional assets since adopting Bitcoin standard

MicroStrategy (MSTR) outperforms leading traditional assets since adopting Bitcoin standard
Paul L.

Bitcoin’s (BTC) last market bull market was inspired by institutional investors who accumulated the assets at historical levels. Among the notable institutions is United States-based business intelligence firm MicroStrategy (NASDAQ: MSTR) which has invested in BTC under the Bitcoin standard. 

After starting to accumulate the flagship cryptocurrency, the company’s stock has recorded positive gains compared to other traditional investment products. In this line, data compiled by Finbold indicates that since MSTR adopted the Bitcoin standard on August 10, 2020, the stock has surged 69.31% as of October 14. 

During the period, the U.S. dollar had the second-highest performance at 20.70% followed by S&P 500 index at 6.60%. Other assets trailing MicroStrategy include NASDAQ index (-5.89%), gold (-18.05%) and silver (-36.95%). 

MicroStrategy records losses after Bitcoin standard 

However, despite MicroStrategy’s stock performance against Bitcoin, the company has emerged among the biggest casualties of the ongoing crypto meltdown. During Q2 2002, MSTR reported quarterly revenue of $122.1 million against expectations of $126 million, with a $918.1 million loss.

Of the losses, $917.8 million was attributed to its Bitcoin holdings. By then, MicroStrategy’s Bitcoin haul was valued at almost $3 billion, against the acquisition value of $3.975 billion. 

Furthermore, following the losses, the company’s CEO Michael Saylor exited his position after being instrumental in helping the company accumulate Bitcoin. 

Interestingly, the company has continued to buy in the dip, with the recent Bitcoin purchase coming between August and September. As reported by Finbold on September 20, the company purchased an additional 301 Bitcoins at the average price of $19,851 per coin, amounting to almost $6 million for the entire purchase. 

Bitcoin correlation with stocks 

However, it is worth mentioning that Bitcoin has traded in tandem with the equities, exhibiting historical correlation as the economy battles high inflation and interest rate hikes. The condition has, however, made assets like the U.S. dollar more prominent, with the currency rising to historical levels while crippling other global currencies. 

For instance, the dollar’s strong performance against global fiat currencies saw investors turn to Bitcoin as a hedge. At the same, the shift to Bitcoin was an opportunity for investors to profit from arbitrage

In the meantime, Bitcoin is attempting to rally past the $20,000 level. By press time, the asset was trading at $19,500. 

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.

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