MicroStrategy may explore ‘future yield generation opportunities’ on 95,643 BTC holdings

MicroStrategy, a business intelligence company, said that it will look into yield generation opportunities on the 95.643 unencumbered Bitcoins (BTC) owned by its subsidiary MacroStrategy.

MicroStrategy released its first quarter 2022 report on Tuesday. It stated that it may “conservatively explore future yield-generation opportunities on unencumbered MacroStrategy Bitcoins” as a consideration after a $205 Million BTC-collateralized Silvergate Bank loan in March. MicroStrategy had approximately $2.9 billion in total BTC as of March 31. This is a result of cumulative impairment losses exceeding $1 billion and an aggregate loss of $4 billion.

According to the firm, “The original cost basis of MicroStrategy’s Bitcoin was $3.967 billion and the market value was $5.893 trillion, respectively. This reflects an average bitcoin cost of about $30,700 and a bitcoin market price of $45,602.79,”

@MicroStrategy, the largest publicly traded #bitcoin corporate owner, has more than 129,200 Bitcoins. Please join the management team at 5pm EDT as we discuss $MSTR Q1 2022 financial results and answer questions about our business & outlook.https://t.co/UOSdCKQOSx
Michael Saylor (@saylor), May 3, 2022

According to the report 95,643 BTC of MacroStrategy’s crypto holdings were “unencumbered” as of March 31. The subsidiary also pledged 19,466 BTC as collateral for a loan of $205 million from Silvergate. MicroStrategy held the remaining 14,109 BTC.

MicroStrategy saw $119.3million in revenue in Q1 2022. This is a 33% decrease from the previous year. The firm also reported $275 million in non-Generally Accepted Accounting Principles expenses (GAAP) for the first quarter, $170 million of which was from BTC impairment costs. MicroStrategy was reportedly contacted by the United States Securities and Exchange Commission in January to request that it stop using non-GAAP methods for calculating its finances.

Related: MicroStrategy adds 4,197 BTC balance sheet

MicroStrategy has now invested $250 million in Bitcoin since August 2020. This was in addition to separate buys made with cash and proceeds from convertible senior notes sales to institutional buyers. At the time of publication, the BTC price was $37,787. This makes the firm’s 129 218 coins worth approximately $4.9 billion.

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