Key Insights
Companies like MicroStrategy and Metaplanet are leading Bitcoin adoption in corporate treasuries.
Corporate Bitcoin holdings have shaken up the markets and are increasing investor exposure to crypto.
These days, more shareholders are supporting capital raises dedicated to Bitcoin accumulation.
The corporate Bitcoin treasury trend has changed over the last few years.
Public companies are more and more treating Bitcoin as a core reserve asset rather than a speculative side bet. So far, executives argue that BTC provides better protection against inflation than holding cash. Additionally, it also sets up firms to benefit from its long-term price appreciation.
No company has gone further in Bitcoin adoption than MicroStrategy, which has now rebranded as Strategy Inc. The company started with modest purchases in 2020 and has built a massive stockpile of more than 632,000 BTC by August of this year.
This stands as more than a 3% slice of the max Bitcoin supply.
MicroStrategy’s current Bitcoin holdings sit at 632,000 Bitcoin | Source: Saylor Tracker
The trend has turned Strategy Inc. into a leveraged proxy for Bitcoin. Its stock has risen over 3,000% since the pivot, as investors are starting to treat it as an indirect way to gain exposure to BTC.
However, the risks still exist. For example, Strategy Inc. relies heavily on borrowed capital to fund its purchases. This makes the firm vulnerable to declines in Bitcoin prices.
If BTC drops, the company’s debt-heavy balance sheet could come under fire.
MicroStrategy is not alone in this trend. So far, companies in Japan, the United States, and beyond are adding Bitcoin to their treasuries.
One major example is Japan’s Metaplanet. The company recently pivoted from hotel operations to a Bitcoin-first strategy and has raised hundreds of millions to purchase BTC.
This September, shareholders approved a plan to issue up to 550 million new shares, with proceeds earmarked for more Bitcoin acquisitions. The approval shows strong investor support for the Bitcoin treasury standard.
The United States has also seen Bitcoin miners like Riot Platforms and MARA Holdings become adopters. However, the list extends further. Tesla and Trump Media and Technology Group (TMTG) have also added Bitcoin to their balance sheets. TMTG announced a multi-billion-dollar BTC purchase this year and called it a way to secure independence from traditional finance.
The rise of corporate Bitcoin treasuries has so far blurred the line between traditional finance and the crypto industry. Firms with large BTC positions are changing market dynamics in two ways.
First, their demand is tightening the asset’s supply. Just as corporations continue to hold a rising share of the limited Bitcoin supply, scarcity pressures are likely to increase. This can fuel price gains. However, it also increases the influence of a small group of companies.
Second, these firms are creating a new type of stock. Investors are now seeing companies like Strategy Inc. as “Bitcoin proxy” equities. This means that their value depends more on BTC’s market swings than on business fundamentals.
The corporate Bitcoin treasury model also comes with its own set of risks. Bitcoin is highly volatile. This means that a sharp downturn can force companies to recognize paper losses or even sell BTC under pressure.
Current accounting standards add even more complexity to the picture.
Firms must record impairment losses when Bitcoin’s market value falls below the purchase price. However, they cannot log gains until they sell. This difference can make financial results look worse than reality.
Another major source of worry is Bitcoin’s concentration. A few large corporate holders now control a large share of Bitcoin. This means that if one of these entities faces a liquidity crisis, a forced sell-off could trigger a decline across the crypto market.
Overall, the next few years will determine whether the Bitcoin treasury trend will prove sustainable. Investors will be watching closely as companies like Strategy Inc., Metaplanet, and TMTG redefine what it means to manage a corporate treasury.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.