MicroStrategy Plans to Purchase More BTC Despite Making Losses in Quarter 2

Sahaj  |  Jul 30, 2021

MicroStrategy held around 105,085 BTC as of June 30, 2021, which are worth a total of $2.051 billion, at a total impairment loss of $689.6 million since the accession of the digital asset. As reported recently, the Business Intelligence and Mobile Software firm, MicroStrategy, has pledged to purchase more Bitcoin despite reporting defacement losses of $424.8 million in the second quarter.

MicroStrategy Pledges to Invest More in BTC

The losses that have been reported are just paper loss and based on the price of BTC at the end of the quarter, a realized loss can not be witnessed. 

Well, it all depends on the method of adding up the figures, but it can not be neglected that MicroStrategy made around a billion-dollar more from BTC than it spent.

Moreover, along with the impassioned belief of Michael Saylor, the CEO of MicroStrategy, in Bitcoin, it can be resolved why the firm has decided to invest more in Bitcoin. The report said:

“We continue to be pleased by the results of the implementation of our digital asset strategy. Our latest capital raise allowed us to expand our digital holdings, which now exceed 105,000 bitcoins. Going forward, we intend to continue to deploy additional capital into our digital asset strategy."

Giant Firms Reporting Losses From Bitcoin in Q2 Report

Not only MicroStrategy but Tesla Motors, the electric vehicle manufacturing company owned by Elon Musk, also reported a significant loss in its Q2 earnings report. 

In addition to this, it should be noted that both the mentioned firms categorize Bitcoin as an intangible asset accounting rules instruction that they must report an impairment loss when the price of Bitcoin slips below its cost basis. 

The company also provided non-GAAP calculations that stand for Generally Accepted Accounting Principles, which in this report exclude the impact of shared-compensation expense and impairment losses and gains on sale from intangible assets.

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