Business intelligence provider MicroStrategy (NASDAQ:MSTR) has one significant sideline: bitcoin (BTC-USD). In fact, MicroStrategy’s share price has been known to move with the price of bitcoin. The stock is down substantially in Wednesday afternoon’s trading, especially after the company revealed it was still buying bitcoin and even selling some of its bitcoin at a loss.
MicroStrategy revealed that, over the last two months, it spent over $55 million just buying bitcoin. The $55 million-plus payout landed the company an additional 2,500 bitcoin. Moreover, MicroStrategy also demonstrated one great reason to have bitcoin on hand: tax purposes. It sold some of its earlier-purchased bitcoin for a capital loss, which is useful as a tax benefit.
MicroStrategy used the cash from the sale to once again buy bitcoin, this time at a much lower price. Back on Thursday, MicroStrategy sold 704 bitcoin for a reported $11.8 million. Then, it spent $13.6 million to buy 810 bitcoin. However, some wonder if MicroStrategy is too focused on cryptocurrency and not sufficiently focused on its software business. Its software business has shown little growth, and its margins aren’t offering much value either.
That’s a point the larger market seems to agree with, especially with cryptocurrency in decline. The last five days have MicroStrategy shares down substantially. Just ahead of Christmas, the stock plateaued at around $163 before dropping off a cliff starting on December 27. Today, shares are down around $140.
Special end-of-year offer: Access TipRanks Premium tools for an all-time low price! Click to learn more.
