MicroStrategy has released a Bitcoin investment guide highlighting the asset's historical volatility. The document notes that Bitcoin previously experienced a 93.1% decline in 2011, which remains the largest drop in its history. It also cites a worst one-year return of minus 83.6%, emphasizing the necessity of risk management and survival strategies for long-term investors.
The guide outlines various risks that can lead to losses even if an investor correctly predicts Bitcoin's appreciation. These include the use of leverage, option decay, unfavorable capital structures, and counterparty failures. Michael Saylor, executive chairman, draws on his experience from 2000, when MicroStrategy stock fell 62% in one day following a financial restatement and subsequent SEC fraud charges.
As of September 7, MicroStrategy held 845 050 BTC with an average cost of $75 412 per coin. With the current market price near $77 106, the company's position is roughly 2% above its cost basis. The firm recently purchased 4 603 BTC at an average price of $80 318, though these recent acquisitions are currently showing losses.
The guide also functions as a product catalog, listing the company's common and preferred stock options. While the document acknowledges that MicroStrategy profits from higher Bitcoin prices, it advises investors to prepare for potential 93% drawdowns. The company maintains that its own corporate strategy remains positioned for long-term asset appreciation.
