Shares of MicroStrategy (MSTR -1.40%) went up today because the price of Bitcoin (BTC 0.21%) starting recovering from yesterday's plunge. The company already owned a ton of tokens. But it officially owns a lot more now, according to today's press release. As a result of its increasing correlation to Bitcoin, the stock was up almost 9% as of 10:30 a.m. EST.
Recently, MicroStrategy offered $1 billion in convertible notes with the express purpose of buying more Bitcoin tokens. The offering was completed last Friday, and the company apparently went right to work buying up Bitcoin. It used its new cash to buy over 19,000 new tokens, taking its total to 90,531.
MicroStrategy's average price for its Bitcoin tokens is now $23,985 each. As of this writing, the price of Bitcoin is around $49,000. Therefore, MicroStrategy's investment of almost $2.2 billion to date is now valued at over $4.4 billion -- a greater-than-100% return in very short order.
For perspective, MicroStrategy's entire market capitalization was less than $2 billion before it started buying Bitcoin in 2020. So this move has been great for shareholders so far. However, shareholders should keep in mind that CEO Michael Saylor doesn't sound as if he's planning to cash out anytime soon. So these quickly gained riches could vanish if the price of Bitcoin falls at some point.
For better or worse, MicroStrategy stock is now tied to Bitcoin and will be even more tied to it in the future. In today's press release, Saylor said, "We will continue to pursue our strategy of acquiring bitcoin."