US business intelligence company Microstrategy released its Q1 financial results in which it disclosed a non-cash digital asset impairment charge of $170.1 million.
The company also revealed the appointment of Andrew Kang as its new senior executive vice president and chief financial officer, who will take over on or around May 9 from Fong Le, who will remain as the firm’s chairman.
- As of March 31, 2022, MicroStrategy held approximately 129,218 bitcoins which were originally acquired for $3.972 billion. The carrying value of $2.896 billion represents a cumulative loss of $1.071 billion.
- The report further noted that the Michael Sayer-led firm’s bitcoin holdings had an original cost base and market cap of $3.967 billion and $5.893 billion, respectively, as of the end of March. This essentially represents an average cost per bitcoin of around $30,700 and a market cap per BTC of $45,602.79, respectively.
- According to the current CFO, Microstrategy has no plans to engage in the sale and will instead continue to acquire and hold bitcoin for the long term. During the earnings call, Lee also said,
“We had another active and successful quarter. We bought $215 million worth of bitcoins at an average purchase price of $44,645 per bitcoin, excluding fees and expenses. We have not sold any bitcoins to date. We are looking to liquidate our bitcoin holdings long term. We do not currently plan to be involved in the sale of bitcoins.”
- MicroStrategy raised $205 million from Silvergate Bank as an interest-only loan for a period of three years, collateralized by bitcoin. The loan will mature on March 23, 2025.
- The company also said that it can “conservatively explore future yield generation opportunities on bitcoin without weighting macrostrategy.”
- Earlier this year, the US Securities and Exchange Commission (SEC) rejected MicroStrategy’s accounting adjustments. To reflect the regulator’s concern, the software company said in a filing that it would remove the adjustment of impairment losses and gains on cryptocurrency-related sales.
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