Despite a $1.3B paper loss, MicroStrategy claims it has no intention to cease trading bitcoin.

MicroStrategy, a software analytics company, reported a paper loss on its Bitcoin assets of over a billion dollars in 2022, but the business insists it has no intentions to cease trading the virtual currency. On February 2, MicroStrategy disclosed its Q4 and year-end financial results for 2022, revealing that the reported nonperforming assets on its BTC holdings, net of profits on sale, were close to $1.3 billion for the entire 2022 financial year.

Despite the apparent deficits, MicroStrategy's CFO, Andrew Kang, stated during the company's earnings call on February 2:

“We may consider pursuing additional transactions that may take advantage of the volatility in Bitcoin prices, or other market dislocations that are consistent with our long-term Bitcoin strategy.”

The success of Bitcoin represents the most significant comparison, according to MicroStrategy co-founder Michael Saylor, who stated this during the conference call. The company monitors its stock performance against “a variety of other benchmarks.”

Saylor said that MicroStrategy had “been able to outperform Bitcoin as an index” over the course of the period when the company was initially disclosed that it was purchasing Bitcoin in August 2020.

Michael Saylor, a co-founder of MicroStrategy, stated on the conference that the business evaluates its stock performance against “a variety of different benchmarks,” with Bitcoin's success serving as the “most relevant benchmark.”

Saylor continued by saying that because MicroStrategy originally disclosed in August 2020 that it would be purchasing Bitcoin, the firm has “been able to outperform Bitcoin as an index” during that period.

In comparison to Bitcoin's 98% rise since August 2020, the company's stock has increased by 117%, he claimed, contributing:

“The only real safe haven for an institutional investor is Bitcoin. Bitcoin is the only universally acknowledged digital commodity, and so if you're an investor, Bitcoin is your safe haven in this regard.”

According to Kang, as of December 31, 2022, MicroStrategy controlled a total of 132,500 BTC, valued at $1.84 billion. Of that, the company controlled 14,890 BTC on its own behalf; the remainder BTC were held through its subsidiary MacroStrategy LLC.

For the first time, the business sold some of its Bitcoin assets late last year. Kang said that the firm “raised our net holdings by 2500 Bitcoin throughout the quarter” despite the sale of the 704 BTC, which was done to realize a tax loss of almost $34 million.

According to reports, MicroStrategy's total sales for the fourth quarter exceeded Wall Street projections and came in at $132.6 billion. It lost $21.93 per share in the fourth quarter. As per data from Yahoo Finance, MicroStrategy's stock price had decreased by more than 4% as of the time of writing.

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