MW MicroStrategy booked billions in losses on bitcoin, and prices have fallen more

By Tomi Kilgore

The biggest corporate investor in bitcoin said it did not buy any of the cryptocurrency during the recent stock-market turmoil

MicroStrategy Inc., the business-analytics software company that touts itself as the largest bitcoin-treasury company, disclosed Monday that it recorded nearly $6 billion in losses on its cryptocurrency assets during the first quarter.

Shares of the Virginia-based company (MSTR), which now does business as Strategy, dropped 6.3% in afternoon trading Monday.

The company had managed to escape last week's stock-market turmoil, as its stock rose 1.5% while the S&P 500 index SPX sank 9.1%, with bitcoin acting as a bit of a safe-haven play at the end of last week.

While the cryptocurrency (BTCUSD) was showing this relative strength, Strategy said in a filing with the U.S. Securities and Exchange Commission that it did not buy any bitcoin during the period between March 31 and April 6. The last purchase it made was spending $1.9 billion to buy 22,048 bitcoin during the week through March 30.

During the first quarter, the company said it bought 80,715 bitcoin for a total of $7.66 billion, at an average price of $94,922 per bitcoin.

But with bitcoin trading well below those prices at the end of the quarter, Strategy said it recorded an unrealized loss of $5.91 billion on its digital assets. As a result, and despite a related $1.69 billion tax benefit, the company expects to report a net loss for the quarter.

Bitcoin prices have fallen 4.2% since the end of the first quarter.

Overall, the company now owns 528,185 bitcoin, which it spent a combined $35.63 billion to acquire at an average price of $67,458 per bitcoin.

Strategy has been stocking up on bitcoin since it announced on Aug. 11, 2020, that it had adopted the cryptocurrency as its primary treasury-reserve asset.

Back in April 2024, Michael Saylor, the company's co-founder and executive chair, took pains to explain why he believed bitcoin was a better reserve asset than other financial assets like stocks, bonds and hard commodities, including gold.

With bitcoin recently trading at $78,939, that means that after five years of buying and not selling, the company's bitcoin holdings were worth about $41.69 billion - which is about $6.06 billion, or 17%, more than what it spent to acquire that holding.

Strategy's stock was viewed as a beneficiary of Donald Trump's presidency, given his self-touted crypto-friendly credentials and his plan to establish a strategic bitcoin reserve.

But the stock has fallen 30.6% since Trump's inauguration, while bitcoin prices have dropped 24.2%, the S&P 500 index SPX has shed 15% and the SPDR Gold Shares exchange-traded fund GLD has advanced 9.9% over the same period.

Strategy's stock has now tumbled 41.9% since it peaked at a post-election record close of $473.83 on Nov. 20, while the S&P 500 has declined 13.9% over the same time.

-Tomi Kilgore

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

April 07, 2025 15:06 ET (19:06 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.