Strategy Aims to Prevent Market Volatility with Bitcoin Purchases
Strategy, as the largest public corporate holder of bitcoin, implements a cautious approach to its significant bitcoin purchases to prevent affecting the overall market price. Shirish Jajodia, the company’s corporate treasurer and head of investor relations, recently disclosed that Strategy’s buying strategy takes market liquidity into consideration. He emphasized that their method of purchasing bitcoin is structured to prevent price manipulation.
Since 2020, Strategy has amassed 629,376 BTC, amounting to over $70 billion. The company carefully manages its acquisitions by matching the available market liquidity, often engaging Over-the-Counter (OTC) desks to facilitate substantial trades without impacting public exchanges. Despite the anticipation and speculation in the market, the reaction to Strategy’s large purchases has been variable.
When Strategy acquired 55,000 BTC towards the end of November, bitcoin prices surged to new all-time highs in December. However, their subsequent acquisition of 21,021 BTC in July was followed by a 4% drop in price within days. Despite these fluctuations, the company remains actively engaged in the market at all times.
Jajodia highlighted that Strategy’s involvement in the market is almost constant, adjusting the pace of their purchases based on prevailing conditions. He mentioned that they are continuously buying bitcoin, indicating that their presence in the market extends to every hour and every second. This perpetual approach aligns with Michael Saylor’s public stance of accumulating bitcoin irrespective of its price, focusing on expanding the firm’s total reserves consistently.
The company’s strategy of buying bitcoin without disrupting the market price is a deliberate effort to maintain stability and prevent abrupt fluctuations. By strategically structuring their purchases and spreading them out over time, Strategy can accumulate significant amounts of bitcoin without causing market disturbances. Their commitment to being actively present in the market underscores their long-term vision of increasing their bitcoin reserves steadily.
The cautious and deliberate approach of Strategy in acquiring bitcoin reflects a commitment to responsible investing and long-term growth. By operating with sensitivity to market liquidity and using OTC desks for large trades, the company demonstrates a strategic and calculated investment strategy. Despite occasional price fluctuations post-acquisition, Strategy remains dedicated to its continuous presence in the bitcoin market, reinforcing its position as a key player in the digital asset space.
