Bitcoin price crashes to 100-Day Low, MicroStrategy’s $730M BTC Purchase to the Rescue?

Ibrahim Ajibade
Updated: Jun 21, 2024, 19:20 GMT+00:00

Key Points:

  • Bitcoin price crashed below the $63,350 on Friday June 21, extending its 14-day timeframe losses to 12%
  • On June 20, MicroStrategy announced the purchase of over 11,931 BTC at $736 million.
  • Technical indicators show that BTC has the potential to avoid further losses if it closes above $64,300
Bitcoin (BTC) price forecast

In this article:

Bitcoin price crashed below the $63,350 on Friday June 21, extending its 14-day timeframe losses to 12%, MicroStrategy’s latest BTC purchase combined with positive technical indicators suggest the trend could flip bullish in the days ahead. 

MicroStrategy Buys 11,931 Bitcoin, Boosting Total Holdings to 226,331 BTC

Nasdaq-listed business intelligence firm MicroStrategy, the largest corporate holder of Bitcoin, has acquired an additional 11,931 BTC for roughly $786 million, increasing its total holdings to 226,331 coins.

This acquisition, strategically conducted between April 27 and June 19, saw MicroStrategy add more Bitcoin to its treasury at an average price of $65,883 per BTC. This raises the cost basis for its entire $13.8 billion holdings to $8.33 billion, with an average price of $36,798 per Bitcoin, including fees.

Microstrategy Bitcoin Holdings as at June 21, 2024 | SaylorTracker
Microstrategy Bitcoin Holdings as at June 21, 2024 | SaylorTracker

This latest purchase follows a previous acquisition of 9,245 BTC for $623 million in March, along with two smaller transactions, pushing the firm’s holdings past 1% of Bitcoin’s total supply of 21 million.

The acquisition was made possible after MicroStrategy completed a private convertible senior note offering, with the notes featuring a 2.25% coupon and a conversion premium of approximately 35% over the average price of the company’s common stock.

Bitcoin Price Forecast: Will BTC Price React to MicroStrategy’s $736M Purchase?

After tumbling to a 30-day low of $63,047 within the daily timeframe, Bitcoin price has now reclaimed the $64,000 level at the time of writing on around 8pm CET  on June 21.

Beyond the positive sentiment from the news event, MicroStrategy’s latest BTC $736 million purchase is unlikely to influence Bitcoin price action in the day ahead as the transaction was strategically spread out over a period of 3-months between April 27 and June 19.

Bitcoin price forecast |(BTC/USD) TradingView
Bitcoin price forecast |(BTC/USD) TradingView

In terms of short-term price action, the lower-limit Bollinger band technical indicator BTC must close trading for the day above the $63,463 level to avoid further downside.

On the upside, if the Bitcoin price can rebound above the $65,000 level, a lot of Short position could be liquidated. This short squeeze could potentially propel BTC into further advancement toward $68,000.

About the Author

Ibrahim Ajibade Ademolawa is a seasoned research analyst with a background in Commercial Banking and Web3 startups, specializing in DeFi and TradFi analysis. He holds a B.A. in Economics and is pursuing an MSc in Blockchain.

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