Strategy (NASDAQ:MSTR) posted a $14.5 billion unrealized loss in Q1, yet the Bitcoin (CRYPTO: BTC) purchases fail to move markets because the company accounts for only 7% of gross inflows.
The Q1 Loss
Strategy held more than $50 billion of cryptocurrency at quarter-end as Bitcoin tumbled more than 20% in Q1, the largest first-quarter drop since 2018.
The company adopted accounting standards last year requiring changes in Bitcoin holdings to flow through earnings, driving multibillion-dollar swings in results.
Strategy reported a $2.42 billion deferred tax benefit in the quarter.
Strategy bought 4,871 Bitcoin from April 1-5 for $330 million at an average price of $67,700, funded through Class A common stock sales and Stretch preferred share sales.
The company has $2.25 billion in cash reserves, enough to cover interest and distributions for more than two years.