The price of Bitcoin drops whenever Microstrategy announces its latest acquisition of the cryptocurrency. This has been the pattern since 2020 said Vetle Lunde, a research analyst at K33. Lunde said that Bitcoin price usually drops by an average of 2% on such days, adding that the reason is that the market tries to absorb the fact that certain buy-side liquidity has left the market.
“MicroStrategy BTC purchase announcements tend to be followed by short-term negative price action in BTC, as the market absorbs the fact that certain buy-side liquidity has left the market,” Vetle Lunde said.
Microstrategy announced it bought 12,000 bitcoins on Wednesday morning. The market price of Bitcoin actually dropped by a small margin. On Thursday, the cryptocurrency which dropped to $30,039 from its Wednesday high of $30,729, recovered its losses reaching an intra-day high of $30,654.
This seemed to confirm what Lunder said about the impact of the MicroStrategy announcement lasting one or two days.
Early Wednesday, business intelligence firm MicroStrategy (MSTR) announced the purchase of over 12,000 bitcoin (BTC) for $347 million. The fresh accumulation has boosted the company’s coin stash to 152,333 BTC.
Since then, the price of Bitcoin has swung above and below the $30k mark. On Friday, June 30, Bitcoin price briefly fell below the $30,000 support, dropping to $29,952 at 6:10 PM, after reaching a high of $31,167. The coin is ranging at $30,500 in the last couple of hours.