Software Firm MicroStrategy Starts New Trend – Buys Bitcoin for $250 Million

World’s Biggest Business Intelligence Software Firm MicroStrategy has purchased 21,454 Bitcoin for $250 million. MicroStrategy has confirmed that it has made Bitcoin its primary treasury reserve asset.MicroStrategy disclosed the Bitcoin purchase in an SEC filing this week. 

In today’s world when companies are putting their surplus capital into bonds and other investments as part of their treasury management strategies, U.S. Software firm MicroStrategy became the first company to bet on Bitcoin for such a significant transaction. MicroStrategy beliefs that Investing in the cryptocurrency would provide not only a reasonable hedge against inflation but also help to earn a higher return than other investments.

According to Michael J. Saylor, CEO, MicroStrategy Incorporated – “Investment in Bitcoin is part of our new capital allocation strategy to maximize long-term value for our shareholders.”

He added – “This investment reflects our belief that Bitcoin is the world’s most widely-adopted cryptocurrency, dependable, and an attractive investment asset with long-term appreciation potential than having cash or bonds. Since its beginning over a decade ago, Bitcoin has emerged as a significant addition to the global financial system.MicroStrategy has accepted Bitcoin as a legitimate investment and superior to cash and has made Bitcoin the principal holding in its treasury reserve strategy.”

MicroStrategy is a Virginia-based business intelligence software company founded in 1989 and currently has a market cap of around $1.2 billion and posted a profit of $34 million in 2019. MicroStrategy clients include big retailers like Pepsi and Adidas, while IBM and Oracle are among its competitors.

Many investors believe that MicroStrategy’s valuation also will change as per Bitcoin’s performance. Considering the history of how Bitcoin has performed, the firm has put a bet on it.

MicroStrategy (Nasdaq: MSTR), founded in 1989 by Michael J. Saylor and Sanju Bansal, is the largest independent publicly-traded business intelligence(BI) firm with the leading enterprise analytics platform.

The firm develops software to analyze internal and external data to make business decisions and develop mobile apps. MicroStrategy 2020 is the latest platform release of its business intelligence software. This platform includes improvements to the vendor’s HyperIntelligence capabilities, an embedded analytics system using augmented intelligence, and machine learning technology.

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