MicroStrategy, the Nasdaq-listed business intelligence company, has become the first publicly-traded company to buy bitcoin as part of its capital allocation strategy.
The company announced on Tuesday that it has purchased 21,454 bitcoins (currently worth over $250 million). MicroStrategy first revealed its plan to buy bitcoin as a way to avoid inflation on July 28.
“Our investment in Bitcoin is part of our new capital allocation strategy, which seeks to maximize long-term value for our shareholders,” said MicroStrategy CEO Michael J. Saylor. “This investment reflects our belief that Bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash.”
It is not clear whether MicroStrategy bought the bitcoins via a crypto exchange or an over-the-counter (OTC) trading desk, and where these bitcoins are held. A MicroStrategy spokesperson declined to provide details, telling The Block: "We don't share the logistics involved in making our BTC transactions."
MicroStrategy's stock is trading up by more than 5% during pre-market hours.
Update: This story has been updated to include comment from a MicroStrategy spokesperson.