When MicroStrategy Inc. began buying Bitcoin in bulk in the summer of 2020, CEO Michael Saylor said it was because inflation would make cash worthless. The crypto pile he has since accumulated was worth $3.4 billion less at the end of the second quarter than the previous one.
Technically, the decline is yet another paper loss for the enterprise software maker under US accounting rules until any of the Bitcoin is sold, but there are consequences. MicroStrategy will likely need to take a substantial impairment charge when it reports second-quarter results. And for shareholders, the stock tumbled 66% in the quarter ended Thursday, outpacing Bitcoin’s 59% decline.