The drop was fuelled in part by CEO Elon Musk’s comments over the weekend that prices of Bitcoin ‘do seem high’.
Major bitcoin corporate backer MicroStrategy Inc said on Wednesday that it bought another 19,452 bitcoin, worth around $1.03bn, swelling its holdings of the cryptocurrency and sending the company’s shares eight percent higher in premarket trading.
The company, whose Chief Executive Officer Michael Saylor is one of the most vocal proponents of bitcoin, bought the cryptocurrency in cash at an average price of about $52,765 each.
MicroStrategy, the world’s largest publicly traded business intelligence company, spent last year steadily amassing bitcoin after making its first investment in August.
The company earlier this month engaged in an almost $1bn convertible note offering with the proceeds used for buying bitcoin.
Bitcoin’s price has recently scaled record highs as major firms – such as Bank of New York Mellon, asset manager BlackRock Inc and credit card giant Mastercard Inc – backed certain cryptocurrencies, with Tesla Inc investing $1.5bn in bitcoin.
Square Inc Chief Executive Jack Dorsey promised on Tuesday to “double down” on the payment firm’s commitment to bitcoin, the world’s biggest cryptocurrency.
MicroStrategy owns close to 90,531 bitcoin, which were acquired at an aggregate purchase price of about $2.17bn and an average purchase price of around $23,985 per bitcoin, it said on Wednesday.
The company’s bitcoin holdings are valued at about $4.48bn, according to a Reuters news agency calculation.
“We will continue to pursue our strategy of acquiring bitcoin with excess cash,” MicroStrategy’s Saylor said.