Michael Saylor
MicroStrategy founder and executive chairman Michael Saylor speaks to Peter McCormack of the What Bitcoin Did podcast regarding the approval of spot Ether ETFs. YouTube | Bitcoin is Forever Money with Michael Saylor IBTimes US

KEY POINTS

  • MicroStrategy bought 2,530 more $BTC worth $243 million
  • Some finance experts have questioned MicroStrategy's Bitcoin treasury strategy
  • One analyst said MicroStrategy's Bitcoin "cycle" will only work if $BTC prices keep rising
  • Bitcoin is up 1.6% in the day, adding some $5,000 to trade in the $94,000 highs early Tuesday

Bitcoin maximalist tech company MicroStrategy has once again made a significant Bitcoin purchase, bringing its total holdings to 450,000, retaining its place as the world's largest known corporate holder of BTC outside the spot Bitcoin exchange-traded funds (ETFs) pool.

Announcing the development on X Monday, MicroStrategy co-founder and executive chairman Michael Saylor revealed that the company's latest buy was 2,530 Bitcoins worth $243 million.

MicroStrategy Brushes Off $BTC Strategy Concerns

The company's latest Bitcoin purchase – being its 10th weekly consecutive buy – amid lingering concerns that its strategy may turn out to be a pitfall if the world's largest cryptocurrency by market cap continues its volatile movements.

Among the critics of such a strategy is David Krause, an emeritus finance professor at Marquette University. He said that he firmly believes treasury assets "should consist solely of liquid and low-risk securities, such as money market instruments."

Prominent financial analyst Jacob King has also called out MicroStrategy's strategy, saying it is "a giant scam and relies on a reflexive loop: it issues debt or equity to buy BTC, which drives BTC's price higher."

King describes the "cycle" as follows: MicroStrategy issues debt or equities to purchase BTC – Bitcoin's price then goes higher amid the positive news – MicroStrategy's market cap is boosted by BTC's price spike – more "sheep investors" buy in – it issues more equity to purchase more Bitcoins, armed with its higher valuation – the cycle repeats.

King went on to accuse MicroStrategy of carrying out a "giant Ponzi," arguing that the company's "cycle" will only work if the digital coin retains an uptrend. "If BTC stalls or crashes (which it will), the loop collapses," he warned.

Despite growing concerns and more detailed explanations about the possibilities of MicroStrategy's strategy collapsing should Bitcoin also plunge to unprecedented depths, the company is unbothered.

Over the weekend, Saylor even encouraged his nearly four million followers on X to "wear the orange tie." Orange is widely recognized as Bitcoin's color, and people who jump into the BTC train are often referred to as "orange-pilled."

MicroStrategy News Buoys $BTC Prices

Since news of MicroStrategy's purchase came around, Bitcoin has been on a gradual climb. From plunging as low as $89,800 Monday, the digital coin is up by 1.6% in the last 24 hours, adding some $5,000 within hours to trade near $95,000.

Bitcoin price early Jan 14 2025
Bitcoin price early Jan. 14, 2025 IBTimes US

The coin's price remains down over 6% in the week, but its 14-day run is back in the green, with a 2.5% increase.

MicroStrategy isn't the only public company stacking up on BTC. Also on Monday, health-tech firm Semler Scientific announced it bought 237 Bitcoins worth $23.3 million, bringing its total holdings to 2,321 BTC.

Semler further revealed that it has generated a staggering 99.3% BTC yield since adopting its Bitcoin treasury strategy in May last year.

Originally published on IBTimes