MicroStrategy (MSTR) shares jumped nearly 20% this week, driven by Donald Trump’s recent election win and a series of Federal Reserve rate cuts. The company, known for its bold Bitcoin investment strategy, has also seen a dramatic 486% rise in share value over the past year as it aims to further expand its Bitcoin holdings.
MicroStrategy’s Bitcoin Strategy Fuels Stock Rally
Currently trading at $271.26 on Nasdaq, MicroStrategy’s stock hit a 52-week high this week. The company, led by prominent Bitcoin supporter Michael Saylor, holds over 250,000 Bitcoin, a portfolio worth around $19 billion based on current prices. MicroStrategy has also announced plans to acquire an additional $42 billion in Bitcoin by 2027, a move that further positions the company as a major institutional investor in cryptocurrency.
Bitcoin itself saw an impressive rally following Trump’s election, rising over 10% to a record high of approximately $76,600 on Nov. 8, adding momentum to Bitcoin-linked stocks like MicroStrategy.
Broader Market Boosts Bitcoin-Linked Stocks
MicroStrategy wasn’t the only crypto-linked stock to experience gains. CleanSpark (CLSK), a Bitcoin mining firm, surged 35% this week, while Coinbase (COIN), a major U.S. crypto exchange, saw a 48% stock increase. Investors’ positive outlook on these stocks stems from expectations of a more crypto-friendly economic climate under Trump’s leadership.
The rally was bolstered by recent Federal Reserve actions to cut interest rates. After reducing rates by 0.5% in September, the Fed followed up with an additional 0.25% cut on Nov. 7, lowering the federal funds rate to a range of 4.5%–4.75%. Lower rates typically drive investor interest in higher-risk assets like tech and cryptocurrency stocks, as borrowing costs decrease and growth expectations rise.
Investor Optimism Spreads Across Markets
In addition to Bitcoin-linked stocks, the broader market experienced strong growth this week. The S&P 500 gained 5%, while the Dow Jones rose by 4.8%, signaling renewed investor confidence. Many investors are optimistic about the economic direction under Trump, anticipating further monetary easing and favorable conditions for tech and crypto sectors.
