Preying on investors How MicroStrategy's pandemic-era bitcoin bet went stratospheric

In the summer of 2020, as the Covid-19 pandemic upended economies around the world, an obscure US software firm decided to diversify.

- Graeme Wearden

In the summer of 2020, as the Covid-19 pandemic upended economies around the world, an obscure US software firm decided to diversify. MicroStrategy, whose head office is situated next to a shopping mall and metro station in Tysons Corner, Virginia, had decided the steady business of "software as a service" was not racy enough. Instead, it would branch out by investing up to $250m in alternative assets such as "stocks, bonds, commodities such as gold, digital assets such as bitcoin or other asset types".

Less than five years later, that bitcoin side hustle has gone stratospheric. MicroStrategy's share price has risen twentyfold, lifting its market capitalization to almost $75bn and catapulting the stock into the Nasdaq 100 index of top technology shares.

That audacious bet by its co-founder and chair, Michael Saylor, has made MicroStrategy a top pick with UK investors, as digital currencies and tokens were fueled by Donald Trump's election victory despite worries that a sharp reversal in crypto prices could threaten its survival.