After a significant decline in Bitcoin’s value, MicroStrategy (MSTR) revealed key updates about its financial standing. As of February 1st, the company reported holding $2.25 billion in cash reserves.
The announcement highlighted that these dollar reserves are intended to be preserved over the next two to three years to support ongoing dividend distributions.
Andrew Kang, an executive at MicroStrategy, emphasized that despite Bitcoin’s price drop, the company continues to follow its strategy with strict discipline. CEO Michael Saylor noted that although Bitcoin’s market price has fallen below their average acquisition cost of $76,000 per coin, no breaches of loan covenants have occurred.
Nonetheless, Saylor addressed a potential downside scenario: if Bitcoin prices were to plunge as low as $8,000, it could challenge the company’s ability to service its debt obligations. At present market values however, MicroStrategy remains capable of fulfilling all financial commitments without issue.
*This content does not constitute investment advice.