MicroStrategy Stock Rides Bitcoin Rollercoaster as Crypto Proxy
-
MicroStrategy holds a large amount of bitcoin on its balance sheet, valued at $8 billion. This makes it a "bitcoin proxy stock" that can benefit from bitcoin price increases.
-
MicroStrategy stock is down 30% this year due to the approval of bitcoin ETFs, which provide an alternative to proxy stocks. However, MicroStrategy's core software business still provides value.
-
Former MicroStrategy CEO Michael Saylor plans to sell $200 million in company shares by April to raise funds to buy more bitcoin ahead of the upcoming halving event, which has previously triggered bitcoin price surges.
-
Some Wall Street voices predict bitcoin could reach $100,000 by end of 2023. If so, the value of MicroStrategy's bitcoin holdings would double, likely doubling its market cap.
-
Investors now have multiple ways to get bitcoin exposure besides proxy stocks like MicroStrategy. But MicroStrategy provides additional value from software operations, appealing to more conservative investors.