Bitcoin regained its upward momentum a while ago, bringing cryptocurrency-related stocks back to life, and the stock price of MicroStrategy (NASDAQ: MSTR ), the world’s largest Bitcoin-holding listed company, also rebounded, surging 11.15% in the past 5 days alone. Investors, however, appear confident that MicroStrategy’s rally will fade, and are aggressively shorting the company’s stock.
According to data from short-selling research firm S3 Partners, more than half of MicroStrategy’s outstanding shares are currently shorted, with a record short-selling rate of 51% and a nominal value of $1.35 billion.
S3 Partners said the number of MicroStrategy shares being shorted now stands at an all-time high of 4.73 million shares, a jump of 1.2 million shares from 30 days ago.
S3 Partners director Matthew Unterman said short interest in MicroStrategy stock has risen by 680,000 shares in the past seven days, suggesting “short sellers are taking advantage of the recent strength to sell.”
It is worth noting that MicroStrategy will announce its second-quarter earnings results after the US stock market closes on Tuesday. The stock price fell 3.6% to $275.74 on Monday. After rising for three consecutive trading days, it ushered in a shock correction.
Over the past two years, MicroStrategy, dubbed “Big Brother Stud” in the cryptocurrency world, has borrowed billions of dollars to buy bitcoin. As of June 28, the company held a total of 129,699 bitcoins, and the purchase cost of all bitcoins totaled $3.98 billion, and the average cost per bitcoin was about $30,664, but this also means that MicroStrategy currently holds bitcoins. The paper loss has exceeded $1 billion.
In May, MicroStrategy CEO Michael Saylor remained bullish on Bitcoin despite the sell-off sweeping the cryptocurrency market. When asked if he had a price target to sell Bitcoin, he responded: “No, we are. Long-term engagement. Our strategy is to buy bitcoin and hold bitcoin.”