Morgan Stanley Boosts Stake In MicroStrategy To 10.9%

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Investment Bank Morgan Stanley has boosted its stake in MicroStrategy ($MSTR) and now owns 10.9% of the business intelligence firm.

According to a filing with the Securities and Exchange Commission (SEC) released on 8 January, Morgan Stanley now holds 792,627 shares in MicroStrategy (MSTR).

The purchase took place on 31 December, just three weeks after Citigroup downgraded the $MSTR stock to a sell.

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MicroStrategy Adopting a Bitcoin Standard

MicroStrategy is a business intelligence firm, which is better known for its move into the Bitcoin space last year.

In August 2020, CEO Michael Saylor announced the company spent $250 million of its balance sheet buying 21,425 bitcoins. That initial investment has risen almost 350% and is now worth $867 million.

At the time, CEO Michael Saylor said the company had taken a deliberate corporate decision to adopt a Bitcoin Standard, because it looked at its cash rich balance sheet and saw it as ‘a melting ice cube’.

The melting ice cube Saylor was referring to was the 15-20% annual inflation he said was eating away at every company’s balance sheet.

Saylor remained true to his word and has since invested a further $225 million of MicroStrategy’s treasury into Bitcoin.

Then in December 2020, the company issued a securities offering for the first time, hoping to raise $400 million to buy more Bitcoin.

MicroStrategy actually raised $650 million at very favourable rates from unknown sources as yet, all of which was spent purchasing bitcoins.

The company has now spent $1.125 billion buying Bitcoin, and owns a total of 70,470, now worth $2.85 billion.

Since MicroStrategy first announced it was adopting a Bitcoin Standard in early August, the $MSTR price has risen 435% from $123 to $531 at close yesterday.

Institutions Have Their Ways

Many institutions can’t get access to Bitcoin with the regulatory hurdles that hamper them. So, publicly traded companies with large amounts of Bitcoin on their balance sheets are a way for them to get exposure.

MicroStrategy was a relatively unknown company until August, but its CEO Michael Saylor made one of the boldest moves in history.

Although MSTR was unknown to most investors, it was a respected company that had the likes of BlackRock, Vanguard and JP Morgan as its biggest investors, before getting into Bitcoin.

The three financial giants are no doubt licking their lips at MicroStrategy’s bold moves after huge gains in less than 5 months, and even Morgan Stanley’s $MSTR purchase is up over 45% in less than 10 days.

Many have attributed this Bitcoin bull run to institutions FOMOing into the Bitcoin space, and it’s clear they are pouring huge swathes of money into Bitcoin, whichever way they can.


Please be advised that the contents of these posts are not to be construed as investment advice. While some of our contributors may be price analysts, their opinions and analyses are personal views and are shared with the intention of promoting discourse and understanding.

Always conduct your own research and consult with a professional financial advisor before making any investment decisions. The Bitcoin market can be volatile, and past performance is not indicative of future results. Invest at your own risk.

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