MicroStrategy Sells Bitcoin for First Time in Years, Impacting Market

MicroStrategy (MSTR), a prominent corporate holder of Bitcoin, has disclosed its first sale of the cryptocurrency since late 2022. Between May 26 and May 31, the company sold 32 Bitcoin at an average price of $77,135 per coin, generating approximately $2.5 million in proceeds.

This sale was executed to facilitate distributions for MicroStrategy's preferred stock, STRC. The company's CEO, Michael Saylor, has previously stated that the firm aims for a strategy of net accumulation, suggesting that for every Bitcoin sold for such purposes, more would be acquired.

Market Reaction and Holdings Overview

The news coincided with a downturn in the broader crypto market. Following the disclosure, Bitcoin's price slipped below $72,000, experiencing a nearly 3% decline within 24 hours. The market saw significant liquidations, with over $93 million in crypto futures positions, predominantly long positions, being closed in a single hour. The 24-hour liquidation total reached $402 million across various traders.

As of May 31, MicroStrategy maintains a substantial Bitcoin treasury, holding 843,706 BTC. These holdings are valued at around $61 billion at current market prices. The company's average cost basis for its Bitcoin acquisition stands at approximately $75,699 per coin, totaling about $63.9 billion. This places MicroStrategy's current position at an implied paper loss of roughly $2.9 billion. The firm's Bitcoin reserves represent over 4% of Bitcoin's total fixed supply of 21 million coins.

Beyond MicroStrategy's sale, other factors were influencing the market, including a 10-session streak of outflows from U.S.-listed spot Bitcoin ETFs, which saw $2.97 billion withdrawn between May 15 and May 29.