MicroStrategy received $917.8 million in non-cash digital asset impairment in Bitcoin assets in the second quarter of 2022. Michael Saylor, a BTC whale, has resigned as CEO of the publicly traded firm. He then took up the post of chief executive officer. Analysts fear the firm will follow in Tesla’s footsteps. Tesla had dumped millions of dollars of BTC in its portfolio in the past weeks.
Bitcoin price could face a major crash
Bitcoin price has started to fluctuate in a narrow range after five consecutive days of declines. Therefore, BTC holders are unsure where the leading cryptocurrency will go next. MicroStrategy, Bitcoin’s largest publicly traded whale, has recently published an announcement. The company received $917.8 million worth of non-cash digital asset impairments from Bitcoin assets in the second quarter of 2022. Interestingly, MicroStrategy’s CEO, Michael Saylor, has resigned from the company’s CEO position. He then moved on to the position of chairman of the board of directors. The BTC maximalist describes this move as an attempt to shift the focus to the BTC acquisition and the firm’s stock. Meanwhile, Phuong Le has replaced Saylor as CEO of MicroStrategy.
Another leading company with Bitcoin on its balance sheet was Tesla. Tesla announced that it has sold about 75% of its Bitcoin holdings in recent weeks to raise cash. Analysts are evaluating whether MicroStrategy will make a similar BTC sale. cryptocoin.com As we reported, MicroStrategy holds approximately 129,699 BTC in its portfolio, worth approximately $2.97 billion. It is possible that MicroStrategy will start selling their Bitcoins soon. If this happens, the number of cryptocurrencies in circulation will increase by close to 1%. Such an increase in the circulating supply of BTC has the potential to cause increased selling pressure. Therefore, the BTC price could collapse as MicroStrategy sells its holdings.
Will MicroStrategy empty the BTC wallet?
It is worth noting that MicroStrategy has not yet announced a Bitcoin sale. However, analysts are speculating about the impact of a possible drop in the firm’s BTC holdings. According to some, it is possible for MicroStrategy to follow a similar investment strategy to Tesla in the current declines. Adriano Feria, a crypto analyst, expects MicroStrategy to follow in Tesla’s footsteps. According to him, it is only a matter of time before the giant firm dumps its BTC assets into the market. MicroStrategy CFO Andrew Kang confirmed that if the price of Bitcoin continues to drop, 85,000 BTC is available to meet collateral requirements. The company bought Bitcoin at an average cost of $30,664 per BTC. Therefore, there is an unrealized loss of around $8,000 on each BTC he owns.
MicroStrategy’s next move is crucial for Bitcoin holders
MicroStrategy is a publicly traded BTC whale holding around $3 billion in BTC. Therefore, Bitcoin owners and traders are watching closely with Michael Saylor’s next move. They are also closely watching whether the firm will continue to buy BTC in line with its “Buy and HODL” strategy. Michael Saylor is a BTC maximalist and celebrity credited with popularizing holding Bitcoin on company balance sheets. MicroStrategy’s bet on BTC went awry in light of the price drop. However, the company continues to hold a stock of 129,699 BTC. Pentosh1, a prominent crypto analyst, says that Bitcoin should be above $22,000. It also claims that the asset is at risk of a major price drop. BTC is changing hands at $23,477 at the time of writing.
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