Key Insights :
- MicroStrategy halted BTC buys after the crypto dropped below $80,000 this week.
- The firm faces a $5.91B unrealized loss, with BTC nearing its average entry price.
- MSTR stock plunged 13% amid Trump’s tariffs and a broader market sell-off.
MicroStrategy has paused its regular Bitcoin purchases after the crypto slipped below the $80,000 mark. This halt surprised many investors recently, watching the firm accumulate Bitcoin aggressively.
The timing coincides with a broader market crash and a significant dip in the company’s stock price. The development raises questions about MicroStrategy’s current financial stance and future Bitcoin strategy.
MicroStrategy Bitcoin Strategy: No New BTC Purchases Past Week
MicroStrategy failed to buy any Bitcoin between March 31 and April 6. This is unusual for the company, which had built a pattern of buying Bitcoin every other week. Previously, it used capital from stock sales to fund these purchases.
The pause follows weeks of significant acquisitions. On March 19, MicroStrategy bought 6,911 BTC for $584 Million. The firm also purchased 22,048 BTC the following week for $1.92 billion. These two moves were among its largest single-week buys.
However, the firm has now stopped. This coincides with Bitcoin falling below $80,000 and the company’s average entry price nearing current market levels.
MicroStrategy revealed that it currently holds 528,185 BTC. These were purchased for $35.63 Billion at an average price of $67,458 per coin. The falling price has erased recent gains and created an unrealized loss.
Unrealized Loss Nears $6 Billion
MicroStrategy has acknowledged the financial impact of the Bitcoin drop. In a recent filing, the firm revealed a $5.91 Billion unrealized loss on its Bitcoin holdings for the first quarter.
This marks a sharp turn from when the company had posted substantial gains. Just weeks ago, the price crash pushed the firm’s average entry level closer to Bitcoin’s current market price.
If Bitcoin continues to fall, the firm risks its BTC investment turning negative. Such a scenario could prompt MicroStrategy to sell part of its holdings to manage losses.
Though any sale would likely be executed over the counter, news of it could influence market sentiment. MicroStrategy holds more than 2% of Bitcoin’s total circulating supply. Even if done privately, a sudden sell-off might still create panic in the market.
MSTR Stock Falls Amid Trump’s Tariffs
MicroStrategy’s troubles are not limited to Bitcoin. Its stock price (MSTR) also experienced a steep decline last week. According to Nasdaq data, the stock fell over 13% and is now trading around $256.
This drop came amid broader market turmoil sparked by Donald Trump’s tariff announcements. His new trade policy has shaken investor confidence and pushed U.S. markets closer to bear territory.
The S&P 500 index lost 3.5% at the opening, while the Nasdaq followed a similar trend. As a result, MSTR stock has given up all its gains from earlier this year.
Notably, it posted a year-to-date loss of 8%. This implies that the MicroStrategy stock could drop below the current level if market conditions worsen.
Whales Still Accumulating Despite Market Drop
While MicroStrategy did not make Bitcoin purchases, other investors kept buying the asset. On-chain analytics platform Glassnode showed whale addresses with over 10,000 BTC attained a robust accumulation trend in the current month.
The score rose to 1.0, slightly indicating active purchase in 15 days. The current accumulation score has further reduced to 0.65, indicating continued interest from large investors.
However, some analysts predict that the Bitcoin bull run is soon over. Ki Young Ju, the CEO of CryptoQuant, also pointed out that some conditions suggest that buying pressure is slowing down.
This puts more questions on MicroStrategy’s halt on its Bitcoin purchase. At the time of writing, Bitcoin price traded at $79,075, an increase of 3% in the last 24 hours. The average trading volume for 24 hours increased by 5% to reach 69 billion.