{"id":402604,"date":"2022-02-02T11:45:05","date_gmt":"2022-02-02T08:45:05","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/microstrategy-lost-146m-to-bitcoin-impairment-charges-in-q4-2021\/"},"modified":"2022-02-02T11:45:05","modified_gmt":"2022-02-02T08:45:05","slug":"microstrategy-lost-146m-to-bitcoin-impairment-charges-in-q4-2021","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/microstrategy-lost-146m-to-bitcoin-impairment-charges-in-q4-2021\/","title":{"rendered":"# Microstrategy lost $146M to Bitcoin impairment charges in Q4 2021"},"content":{"rendered":"

“# Microstrategy lost $146M to Bitcoin impairment charges in Q4 2021 <\/strong>”
\n<\/p>\n

MicroStrategy, the fortune 500 company with a 125,051 Bitcoin (BTC)-strong treasury,\u00a0announced <\/a>its Q4 2021 financial results on Feb. 2.<\/p>\n

The institutional software solution provider reported a net loss of $146.6 million incurred in impairment charges on its Bitcoin holdings. The high impairment losses added to the company\u2019s operating expenses which saw a 125% increase at $248 million as compared to the same quarter last year.<\/p>\n

An impairment loss is a recognized reduction in the acquisition cost of an asset that is triggered by a decline in its fair value. When the fair value of an asset declines below its purchase amount, the difference is written off.<\/p>\n

The firm has lost nearly a billion dollars ($901 million) in impairment charges on its BTC holdings over the last six quarters.\u00a0<\/p>\n

MicroStrategy decided to add BTC impairment charges after the U.S. Securities and Exchange Commission (SEC) rejected its existing \u2018non-GAAP\u2019 Bitcoin accounting methods. SEC asked the business intelligence firm to add share-based compensation expense and impairment losses and gains on sale.<\/p>\n

The impairment losses of $146.6 million were the third-highest for the company where it accounted for 25% of its BTC purchase in the same quarter. The highest impairment loss came in the second quarter of 2021 where it lost about 80% of the total BTC value purchased in that quarter.\u00a0MicroStrategy recorded a net loss of $90 million or $8.43 per share on a diluted basis in Q4.<\/p>\n

Related: MicroStrategy buys the dip by purchasing 660 Bitcoin for $25M<\/em><\/strong><\/p>\n

MicroStrategy currently holds a total of 125,051 BTC acquired for about $3.78 billion at an average price of $30,200 per Bitcoin.\u00a0<\/p>\n

Microstrategy started buying Bitcoin in August 2020 to use it as a treasury hedge instead of the U.S. Dollar. The firm has been instrumental in bringing Bitcoin to institutional firms and public companies including the likes of Tesla and SpaceX. <\/p>\n