MicroStrategy outperforms Apple, Google and Bitcoin price despite BTC dip to $28,000
|- MicroStrategy grew by 166% since adopting Bitcoin in August 2020, while Bitcoin increased by 143%.
- Bitcoin price fell to trade at $28,000 as JPMorgan rescued First Republic Bank.
- The recent banking failure led to the loss of more assets than the 25 banks of the 2008 financial crisis.
Michael Saylor’s MicroStrategy became the first company in the world to build its treasure with Bitcoin in 2020. Thus begin the endless debate about whether it is the right decision or not, but it seems like the company has managed to silence its critics in a very simple yet effective method.
MicroStrategy outperforms top stocks and BTC
Back in August 2020, Michael Saylor, the founder of the company, announced that MicroStrategy would begin purchasing Bitcoin to stack up its inventory and create a BTC-dependent company. Today with about 140,000 BTC, the company currently holds nearly $4 billion worth of the asset.
This inventory turned profitable back when Bitcoin price climbed over the $29,000 mark. Furthermore, since the company embraced the Bitcoin strategy, the value of its stock MSTR has grown by 166%.
MicroStrategy performance since adopting Bitcoin
To put this into perspective, in comparison, the next best stock is the computer technology corporation Oracle (ORCL), which rose by just 72%. The likes of Apple (AAPL) and Google (GOOG) do not even compare to MicroStrategy, as the growth in the last three years stands far lower at 51% and 48%, respectively.
In the same period of time, the asset MicroStrategy has built up on has only increased by 143%. Nevertheless, the company still draws criticism due to the BTC strategy as the broader market volatility continues to swing prices every now and then.
Bitcoin price goes down, justifies criticism
Bitcoin price at the time of writing was at $28,000 after falling by 4.1% during the intraday trading. The biggest cryptocurrency in the world painted a red candlestick following the news of JPMorgan rescuing First Republic Bank. This had a divergent impact on BTC as opposed to the stock market, as it was feeding on the hype of banks failing.
BTC/USD 1-day chart
Thus, the volatility presented here validates the criticism towards BTC. In line with the same North Rock Digital founder Hal Press recently stated,
“The idea of taking a software company and levering it to the gills to run a “Bitcoin acquisition strategy” is so comically stupid it’s actually quite funny. Will be so obvious in hindsight.
He further noted that eventually, all of the Bitcoin held by Saylor’s MSTR would need to be sold to the market, which would be the best time for traders to short the cryptocurrency.
But at the same time, no investment is safe at all, given the recent banking failure. As Silicon Valley Bank, Silvergate Bank and Signature Bank collapsed, the three banks together led to the loss of more assets than the 25 banks of the 2008 financial crisis after accounting for inflation.
THE 3 BANKS THAT HAVE COLLAPSED IN THE LAST FEW WEEKS HAD MORE IN ASSETS THAN ALL THE BANKS THAT COLLAPSED IN THE 2008 FINANCIAL CRISES COMBINED EVEN AFTER ADJUSTING FOR INFLATION
— GURGAVIN (@gurgavin) May 1, 2023
BUT THE WHITE HOUSE SAYS “ THE US BANKING SYSTEM IS SAFE” pic.twitter.com/Uz3CeYhIEx
THE 3 BANKS THAT HAVE COLLAPSED IN THE LAST FEW WEEKS HAD MORE IN ASSETS THAN ALL THE BANKS THAT COLLAPSED IN THE 2008 FINANCIAL CRISES COMBINED EVEN AFTER ADJUSTING FOR INFLATION
— GURGAVIN (@gurgavin) May 1, 2023
BUT THE WHITE HOUSE SAYS “ THE US BANKING SYSTEM IS SAFE” pic.twitter.com/Uz3CeYhIEx
The government still states that the banking system is safe while taking shots at Bitcoin, which lacks regulation. This problem, too, is expected to be solved soon, and then the world will know for sure whether MicroStrategy made the right call or not.
Read more about Bitcoin and its correlation with the stock markets - Is Bitcoin price set to shine as stock market investors “Sell in May and Go Away”?
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