MicroStrategy’s Bitcoin holdings have hit a new low. According to a recent report, the reserves are now worth $3.4 billion less compared to the previous one at the tail end of Q2.
MSTR’s Bitcoin stockpile was valued at roughly $6 billion at the end of the Q1, and by late June was worth only $2.45 billion, or 59.3% less in just three months.
Phong Le MicroStrategy’s president and CFO in a May 3 interview reiterated that the firm would continue to acquire and hold BTC for the long term. He also disclosed that there was no plan to sell.
Michael Saylor, CEO of MSTR began buying Bitcoin in 2020 and said at the time that inflation would make cash worthless. The maverick billionaire often downplayed concerns arising from the devaluation of his BTC stock amidst the crypto market wipeout.
But the latest decline might be a cause of concern for the business intelligence firm when it reports its second-quarter results.
MicroStrategy noted at the end of June that it would report results as usual later in the coming quarter even though Wall Street regulators typically require companies to flag big losses much earlier.
According to a recent filing with the US Securities and Exchange Commission, MicroStrategy bought another 480 Bitcoin worth about $10 million between May 3 and June 28, for about $20,817 each, during the peak of the crypto bear market.
But soon rumors started to gather steam that the firm’s Bitcoin bet is on the verge of facing liquidation.
MicroStrategy CEO Slams Rumours Of Liquidation
As reported by TronWeekly, in March, MSTR borrowed a $204.7 million loan from crypto lender SilverGate bank to fund its Bitcoin purchases.
With Bitcoin’s price plunging to a new low, the firm’s BTC reserves value too dwindled significantly, sparking rumors that the MSTR could soon face liquidation under $21,000.
Dismissing any speculations, Saylor chose to instill confidence among investors by saying even if Bitcoin dropped below 95%, it would still be financially stable and prepared for any emergency scenario.
“If bitcoin goes down by about 95%, then we would have to pledge some additional collateral,” Saylor added. “We also have other cash flows and assets…so we were prepared for the worst case.”