Morgan Stanley bought an additional stake in Microstrategy.
Morgan Stanley now owns 10.9% of Microstrategy
Morgan Stanley’s 10.9% stake in Microstrategy is equivalent to over $ 300 million worth of Bitcoin.
It looks like another financial entity got on the Bitcoin train, but through an indirect purchase of BTC.
Morgan Stanley, one of the world’s largest financial institutions, recently announced the additional acquisition of Microstrategy shares. The purchase brings his stake in the company to 10.9%.
This stake also means Morgan Stanley owns 10.9% of Microstrategy’s Bitcoin treasury. This allows it to indirectly hold nearly $ 300 million in Bitcoin at its current price.
Do banks want bitcoin?
Morgan Stanley already has a stake in Microstrategy. However, this addition increases it significantly. As a multinational investment bank, this purchase is an important sign of Morgan Stanley’s outlook on Bitcoin as it represents a very large portion of Microstrategy’s current reserve cash. This purchase shows that even banks like Morgan Stanley are increasing their exposure to Bitcoin. This idea might have sounded like a fairy tale last year.
Is Microstrategy Setting a New Standard in Bitcoin?
Microstrategy was the first major publicly traded company to actively convert part of its reserve cash into Bitcoin. Many mainstream observers sharply criticized this decision at first. Citigroup, another investment bank, initially downgraded its outlook for Microstrategy’s share price. They believed the move would seriously damage investor confidence in the company.
Citigroup was wrong in its forecast. Bitcoin’s price continued to rise along with Microstategy’s holdings of BTC and its overall market performance. Over the past year, MSTR stock has risen by over 350%.
Microstrategy CEO and Bitcoin Bull Michael Saylor led the company to BTC. Saylor was initially skeptical of Bitcoin, but the mix of Bitcoin’s fundamentals and the global economic and social conflicts caused by covid caused him to change his mind.
One of the main factors for Saylor is the increase in the rate of inflation observed by fiat currencies around the world. He sees Bitcoin as a store of value and a better hedge against inflation than gold. As such, he decided that it would be best for Microstrategy to convert part of its cash reserve of US dollars into Bitcoin.
After an initial Bitcoin purchase of several hundred million dollars, Saylor decided that Microstrategy needed even more Bitcoin. The company then raised $ 650 million through a debt offer. This catapulted Microstrategy’s Bitcoin purchases to over $ 1 billion in total . Currently, the stake is valued at around $ 3 billion. Many other companies have since followed suit. Companies like Mass Mutual, Skybridge Capital, and Ruffer invest hundreds of millions or more in Bitcoin.