"Their balance sheet is primarily a function of the price of Bitcoin," said Dave Zion, founder of Zion Research Group. "They're not in control of the price of Bitcoin, so they're just going to ride that wave, and it's a wave that could go up or down."
Saylor, a co-founder and chairman, decided to invest in Bitcoin in 2020 as a hedge against inflation while MicroStrategy's revenue growth stagnated.
The firm initially used cash from operations to make the purchases, and has shifted to using the proceeds from the issuance and sale of stock, as well as convertible debt sales.
While the strategy has drawn skepticism from traditional corporate governance observers, it has been embraced by investors as a leveraged way to participate in the Bitcoin rally without having to deal with digital wallets or crypto exchanges.
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