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The Midas Touch of Bitcoin
By Vishakha Thakur
With its price hovering around $67k and pegged to cross $70k soon, Bitcoin, the flagship cryptocurrency of the new world of digital currencies, is all set to emboss its indelible imprint on the global economy. That is especially so because of the prevailing economic uncertainties that have almost pushed traditional assets onto the brink of volatility. The result: Big corporations across the world are piling up Bitcoin to salvage their fortunes and strengthen the balance sheets.
No wonder, Bitcoin is being viewed as a revolutionary form of digital treasury, sort of a hedge against inflation, and has become a strategic financial tool for Corporations seeking to attract shareholder value for growth and resilience.
Leading the pack is MicroStrategy, the US-based tech giant with the largest chunk of Bitcoins, whose aggressive Bitcoin acquisition strategy transformed its market valuation from $1 billion to over $35 billion, earning it the reputation of a “Bitcoin proxy”.
Taking a cue from this spectacular growth, other corporations such as Marathon Digital, Tesla, Metaplanet, and Samara Asset Group, too, have adopted similar strategies to reap in substantial returns.
Microstrategy
Microstrategy, a U.S based company that deals in business intelligence and cloud-based services is often called a ‘bitcoin proxy’. The company is such as it owns an astounding 1.2% of Bitcoin’s total supply. It is the largest corporate holder of Bitcoin with a stash of 252,220 worth over $17 billion.
As per Michael Saylor’s strategy, his firm has been piling up Bitcoin since the year 2020, and the move has proven to be a benefit for the company, with its shares rising 1,500% while the S&P 500 index increased little more than 111%. Clearly, Microstrategy has outperformed every other firm in the S&P 500 since launching its Bitcoin strategy.
Rationale Behind Microstrategy Piling Up Bitcoin
Michael Saylor, the co-founder and CEO of Microstrategy, revealed in an interview with the ‘Iced coffee hour’, that the company’s strategy to acquire Bitcoin was their last chance to prevent the shutting down of the company.
What was supposedly the final attempt for mere survival turned out to be a blessing in disguise as— soon after the Bitcoin acquisition—Microstrategy’s market cap shot up from $1 billion straight to over $35 billion forcing other global corps to sit up and take note of this unusual phenomenon.
“My long-term forecast is Bitcoin going to $13M over 21 years”
– Michael Saylor
According to Reuters, analysts suggest that MicroStrategy’s purchase of Bitcoin to protect the value of its reserve assets has helped strengthen the appeal of the firm’s stock, which tends to move in tandem with the digital asset.
As per crypto analyst Tyler Durden, MicroStrategy stock could be headed for more upside momentum.
Marathon Digital
Marathon Digital, the second-largest holder of Bitcoin after Microstrategy, is basically a U.S based largest mining company in the world. Notably, it is the second-largest public holder of Bitcoin, right behind MicroStrategy. According to Bitbo data, it holds 0.12% of the total BTC supply, or nearly 26,842 tokens, with an estimated value of almost $1.8 billion. Marathon Digital Holdings began buying Bitcoin in July 2024 when its valuation was over $6 billion.
“We believe Bitcoin is the world’s best treasury reserve asset and adopting a full HODL strategy reflects our confidence in the long-term value of Bitcoin” – Fred Thiel, Marathon’s CEO
Bandwagon Effect
Microstrategy’s aggressive Bitcoin acquisition strategy has had a cascading effect on other global corporations like Metaplanet, Samara forcing them to make their own Bitcoin investments.
Tesla
Elon Musk’s Tesla, the pioneer in electric vehicles, is the third largest Bitcoin holder among public Corporations after Microstrategy and Marathon Digital. To shed more details on Tesla’s crypto strategy, it began buying Bitcoin in February 2021 when its market valuation was around $765 billion and eight months later, it became a trillion-dollar company with a market cap hitting $1.2 trillion. Interestingly, the bitcoin holding of the company is 11,509 BTC and SpaceX is said to be holding around 8,285 crypto coins.
“Bitcoin could be used for economic empowerment” – Elon Musk,
CEO, Tesla
Metaplanet
Metaplanet, a Japanese investment firm, which recently purchased 107 Bitcoins bringing its total Bitcoin holdings to 855 Bitcoin, worth approximately $56 million, boasts the 23rd largest Bitcoin holdings among public corporations. Ever since it unveiled its Bitcoin investment strategy in April, the company’s share price has shot up 480% according to data released by Yahoo Finance.
“Metaplanet’s Bitcoin strategy is inspired by MicroStrategy and its Chairman Michael Saylor”- Simon Gerovich, CEO, Metaplanet
Samara
Co-founded by Bitcoin Bull Mike Novogratz, Samara Asset Group, the Malta-based European investment company, that focuses on seeding tech and crypto startups, also wants to follow the Microstrategy playbook. Samara currently has exposure to around 421 Bitcoin and is looking to significantly increase its holdings to 1000 Bitcoin by year end.
Samara’s shares rose by around 15% after it announced moves to increase its Bitcoin holdings.
“Not sure it’s possible, but it’d be a dream to stack as much as Michael Saylor”- Patrick Lowry, Samara’s CEO
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