We are not new to the volatile world of cryptocurrencies or buying on the “dip.” That is one strategy you will often hear among cryptocurrency investors whenever there is a bearish market. It seems MicroStrategy has pushed for this strategy by increasing its Bitcoin stock before the year ends.
Bitcoin hit a bear market shortly after gaining value on December 14, 2022. Barely ten days after that, many believed a further crash was imminent and warned against shoring up the cryptocurrency. Nevertheless, MicroStrategy may have something up its sleeve by increasing its Bitcoin holdings by 2,500.
The recent purchase puts the total Bitcoin stock of MicroStrategy at 132,500 BTC. You would agree that the company has made a bold move, especially during these uncertain times. However, has MicroStrategy seen something that the broader investor market needs to see?
MicroStrategy’s Big Move
The company made the big move to increase its Bitcoin holdings by 2,500 on December 27, 2022. More details are yet to emerge on the company’s big purchase. As of this writing, MicroStrategy’s latest acquisition stands at $4 billion.
This bold move has sparked quite a reaction in the crypto community. Some say it’s a move that will cause a lot of pumping along the way, while others praise the company for having so much courage. You would agree that the whole purchase looks counterintuitive, considering the cryptocurrency’s run in 2022.
Bitcoin has declined since March and has made minimal effort to go bullish. The year has crushed crypto, with its price tumbling from $47,062 as of March 31, 2022. By November, it was trading below $20,000.
The recent happenings in the crypto industry have yet to restore public confidence in purchasing. Yet, MicroStrategy pulled its weight by acquiring more bitcoin going into 2023. While the move is surprising, let us remember that it comes from a prominent analytics company.
Behind the Purchase
MicroStrategy is a celebrated analytics and security company that brings innovations to business intelligence. It offers business intelligence, hyperintelligence, product innovation, consulting, and cloud solutions. Furthermore, the services spread from the financial sector to healthcare, retail, and the government.
Even though the company is a proven leader in BI analytics, its soft spot for Bitcoin is still the most disruptive thing about it. Michael Saylor, the CEO, made a controversial comment about purchasing $425 million in bitcoin. While that statement came in 2021, the company began investing in bitcoin as early as 2020.
The recent purchase was not the first time the company shored up its bitcoin supply in 2022. It purchased 301 bitcoins in August 2022, bringing its total supply to 130,000 BTC. Now, it seems the company is banking on a bull run in 2023 and beyond.
Should you follow suit and boost your stock? The reality may be more startling than what the charts show.
Is Bitcoin in an Accumulation Phase?
MicroStrategy’s bold move has reignited talk of bitcoin being in an accumulation phase. This phase is when the price of a cryptocurrency has hit a low and is starting to level out. Of course, the panic over further drops continues, resulting in more sales.
Investors and crypto traders with a lot of experience see this time as a chance to get ready for a bull run. That means the crypto price will begin to rise after flattening out. On that account, MicroStrategy’s purchase might be a stock-up for a bull run.
Bitcoin’s price chart shows that the crypto has not had any significant price drops since November. Instead, it has maintained a reasonable value in recent weeks. That comes even after the storms that hit the crypto industry recently.
One way to talk about MicroStrategy’s recent purchase of 2,500 BTC is to talk about the accumulation phase. The amount is more significant than its purchase in August, meaning the company is more confident in its move.
It has been a challenging year for the crypto community and investors. Many cryptocurrencies have lost their value, with controversies surrounding the major centralized exchanges. With that in mind, you will understand the startling nature of MicroStrategy’s purchase.
While this move will shock many, seasoned investors and traders may not be moved. The accumulation period makes
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