MicroStrategy Sells Equity to Buy 11,000 More BTC as Price Reaches New ATH

This past purchase is already producing gains of 3.2% for the business intelligence firm. Meanwhile, its total BTC holdings have now increased to 461,000 tokens valued at $48.2 billion based on today’s market prices.

These BTC tokens have been acquired at an average cost of $63,610. To fund this investment, the company has made several bold moves. For example, for this last purchase, MicroStrategy sold $1.1 billion worth of its common shares.

In October this year, the firm entered an agreement with various investment banks to sell up to $21 billion worth of its class A equity instruments. All of this money will be used toward its BTC investments.

Bitcoin Could Face Sharp Correction Amid Recent Double Top

The launch of Donald Trump’s celebrity token – $TRUMP – managed to push the price of BTC to fresh all-time highs at $109,365. However, once the hype passed, it retreated rapidly and has not yet recovered.

As a result, a bearish double-top pattern has now emerged that could signal an upcoming drawdown. For now, the price has managed to find support at a former trend line. Along with this, the 20-day simple moving average (SMA) may serve as a floor for any short-term decline.

A break of those two supports would confirm the double-top pattern and this could result in a much stronger pullback that could push BTC to the $90,000 area for a total downside risk of 13.8%.

On the positive side, the Relative Strength Index (RSI) is still on an uptrend. Since rumors have been circulating for the past few days about a handful of pro-crypto executive orders that Trump may sign once he gets into office, there are still some positive catalysts that could propel BTC to a new ATH.

For now, traders should be cautious of how the price action behaves in the next few days as the double-top formation is the most notorious technical formation seen in the daily chart.

MicroStrategy Doubled its BTC Holdings in Just Five Months

This is now the eleventh week in a row in which MicroStrategy buys BTC. According to data from BiTBO, the company ramped up its purchases starting in September 2024. Back then they owned just 226,500 tokens.

As a result of these latest moves, they have increased their BTC holdings by 105.3%. Donald Trump’s victory in the United States presidential election could be one of the reasons why Saylor is increasing the firm’s exposure to this digital asset recently.

Trump is now a vocal supporter of the crypto space. Meanwhile, dozens of pro-crypto legislators have made their way to the U.S. Congress and will start to push forward comprehensive legislation that brings regulatory clarity for the sector.

All of these developments may be paving the way for a brighter future for the blockchain industry and MicroStrategy seems to be positioning itself to reap the highest returns if Bitcoin (BTC) keeps climbing to new heights.

Critics of Saylor’s approach of going into debt and selling equity to buy BTC point out that the company is incurring significant risks as its market value is now heavily dependent on the value of the cryptocurrency.

MicroStrategy is currently valued at $97.7 billion, which is almost exactly 2 times the value of its BTC holdings. In total, its latest quarterly report shows that, aside from the latest equity sales the firm has made, it has also amassed a total of $3.8 billion worth of senior secured convertible debt for its BTC-centered strategy.

The company’s decision to ramp up its BTC purchases at a point when the price has made all-time highs has increased its cost basis significantly. This makes the firm’s market value much more susceptible to drawdowns.