Even after bagging the position of the largest holder of Bitcoin (BTC), MicroStrategy has not backed down from purchasing more of the leading cryptocurrency.
More so, its first quarter purchase has once more buttressed the firm’s strong conviction in its Bitcoin strategy. According to the business software firm’s balance sheet, MicroStrategy acquired 7,500 BTC in Q1 2023.
Altogether, MicroStrategy has a BTC holding of approximately 140,000 and by the current market value, they are worth $4 billion.
MicroStrategy Reinforces BTC Stance
Co-founder and former Chief Executive Officer (CEO) of MicroStrategy Michael Saylor commented “We found by simply acquiring and holding Bitcoin we can outperform our peers in the enterprise software business. The regulatory environment for Bitcoin is improving. As capital flows out of the crypto industry, it flows into Bitcoin.”
In a Twitter post, Saylor said “In #Bitcoin We Trust.”
MicroStrategy President and Michael Saylor’s successor Phong Lee reiterated “The conviction in our bitcoin strategy remains strong as the digital asset environment continues to mature.”
MicroStrategy’s Q1 2023 versus Q1 2022
Compared to Q1 2022, the software company appears to have made significant progress which was attributed to privileges from income taxes and the profit of debt extinguishment. In Q1 2023 which ended on March 31st 2023, a net income of $461.2 million was reported. Notably, this is a far cry from the $130.8 million loss made in Q1 2022. The last quarter of last year ended with an even bigger net loss of $249.7 million.
Operational losses in Q1 2023 were trimmed to only $20.3 million as opposed to $170 million in Q1 2022. In terms of total revenue, there was a 2.2% growth from Q1 2022, bringing the value to $121.9 million.
Silvergate Bank Receives Loan Prepayment From MicroStrategy
Speaking about its outstanding debt to embattled United States financial institution Silvergate Bank, Andrew Kang, MicroStrategy’s Chief Financial Officer said;
“In Q1, we strengthened our capital structure by reducing leverage by fully repaying our bitcoin-backed loan.” The company alongside Tether, severed their ties with Silvergate Bank when it suffered liquidity challenges.
During that time, MicroStrategy clarified that it only had a loan to pay Silvergate but it was not due until Q1 2025. However, the company pre-paid the loan in March at a 22% discount and became entirely free of its obligation to the U.S. bank.