Microstrategy has turned into one of the biggest businesses in terms of financial reserves. The reason for this was Michael Saylor’s decision to invest in Bitcoin rather than keeping cash in his previously little software company.
Microstrategy holds $26 billion worth of Bitcoin, which exceeds the cash investments of major companies such as Johnson and Johnson, IBM, and Nike.
Data shows that while some companies like Apple and Alphabet have more money in their reserves, Microstrategy’s bitcoin investments are more than the financial investments of top companies like Nike, IBM, and J&J.
Saylor invested in Bitcoin back in 2020 as a hedge fund against inflation. At that time the company’s revenue growth was also slow. The firm started by buying Bitcoin from in-house earnings and later shifted to raising funds by selling stock and convertible debt to accelerate Bitcoin purchases. Now it stands as the largest publicly traded company to hold cryptocurrency.
Some experts in corporate governance have been skeptical of crypto investment strategy. However, investors have supported this decision as it gives them exposure to Bitcoin’s price surge without dealing with crypto wallets or exchanges.
Since mid 2020 Microstrategy’s stock has surged by 2500%. This increase was driven by 700% increase in the value of Bitcoin. The company also became the best-performing major US stock around that time.
As of recently Bitcoin also reached $93,500 on Wednesday hitting an all-time high.
ETF Foundation president Nate Geraci has predicted that asset manager Vanguard Group will soon allow access to spot Bitcoin and Ethereum exchange-traded funds on its brokerage platform.
Vanguard, known for its cautious approach to crypto-related investment products, remains one of the few major asset managers that has excluded Bitcoin and Ethereum ETFs from its offerings.
The firm, which manages $7 trillion in assets and serves nearly 50 million clients, has avoided issuing crypto ETFs and blocked clients from purchasing them.
Meanwhile, the amount of Bitcoin ETFs held by the ten issuers has reached 1.07 million BTC after the massive inflows into the product since Trump was announced as the winner of the US elections. Between November 11 and November 13, the Bitcoin ETFs saw a net inflow of $2.44 billion but recorded outflows of over $400 million yesterday.
US spot Bitcoin ETFs could soon hold more Bitcoin than the estimated 1.1 million that Satoshi is holding.
BlackRock IBIT remains the biggest Bitcoin ETF and recently reached $40 billion in assets within two weeks of hitting $30 billion.
The product achieved this milestone in a record 211 days and is now a top 1% ETF by assets within just 10 months of launch, bigger than all the 2,800 ETFs launched in the last 10 years.