MicroStrategy, led by Michael Saylor, has become a key player in using Bitcoin, holding 439,000 BTC worth about $46.92 billion, making up over 2% of Bitcoin’s total supply.
The company is using debt and equity to buy Bitcoin, which is different from usual corporate finance methods. MicroStrategy recently raised $1.5 billion by selling shares and then bought 15,350 BTC at an average price of $100,386. This method lets shareholders invest in Bitcoin without owning it directly.
This strategy has growth potential, but it also comes with risks because MicroStrategy’s market value is closely linked to Bitcoin’s price changes. A big drop in Bitcoin’s value could hurt the company, but experts think it wouldn’t quickly destabilize MicroStrategy.
The crypto market grew a lot in 2024, with Bitcoin going over $100,000 for the first time, thanks to supportive pro-crypto policies and a market value of $3.8 trillion, nearly double what it was.
Other companies, like Riot Platforms and Marathon Digital, are starting to buy Bitcoin as a reserve asset, just like MicroStrategy. Blockstream has started a new division to help businesses manage their Bitcoin investments better. MicroStrategy’s large Bitcoin holdings raise worries about decentralization, as having so much Bitcoin in one place can cause market instability when people sell.
On the other hand, companies like Block Inc. choose to reinvest profits into reserves instead of taking on debt. With more institutions showing interest in Bitcoin, experts suggest spreading investments and staying alert to market trends.
MicroStrategy has made Bitcoin a recognized corporate asset, but its impact creates difficulties for market stability and decentralization. The balance between corporate influence and Bitcoin’s core principles will determine its future, highlighting the need for a long-term investment view.
