Corporations Will be the Next Big Buyers of Bitcoin

Today, 41 companies hold bitcoin as a reserve asset

Corporations Will be the Next Big Buyers of Bitcoin

Michael Saylor is one of the smartest men in the crypto space I know of. Yet for a short time, bitcoin’s legendary volatility made him look like the dumbest.

Saylor founded MicroStrategy in 1989. The company makes business intelligence software and provides cloud-based services.

In August 2020, it became one of the first publicly traded companies to add bitcoin to its corporate treasury.

Wall Street called Saylor crazy for adding bitcoin to his balance sheet. On the surface, you couldn't blame them for their skepticism.

At that time, bitcoin was mired in the brutal 2018-2020 Crypto Winter… It was down more than 50% from its high and had been trading relatively sideways for nearly two years.

So, it’s no surprise the mainstream media derided him for proclaiming bitcoin is “100x better than gold.” He even got into an infamous Twitter feud with notorious “gold bug” Peter Schiff.

Here’s what Schiff tweeted about Saylor in May 2021:

CEO’s who followed @michael_saylor’s asinine advice to plug their balance sheets into #Bitcoin to hedge against an expected annual #inflation rate of 2% are now down as much as 34% on their “hedge” in one month. That’s 17 years of expected inflation losses. Time to pull the plug!”

Like me, Saylor knew bitcoin was a world-class asset that was trading way below its value. And like me, he predicted bitcoin would once again surpass its all-time highs.

Fast-forward to today… And Saylor’s bet is paying off handsomely.

In its first quarter filing with the Securities and Exchange Commission, MicroStrategy said it holds about 214,400 BTC at an average price of $35,180 per coin in its corporate treasury.

That’s an average gain of 95% over four years. By comparison, the S&P 500 is up 57% over the same span.

Here’s why I’m telling you about Saylor. He is a visionary when it comes to corporate ownership of bitcoin. And we just got an idea of what that vision will look like…

Another Company Bets on Bitcoin

On Tuesday, Semler Scientific announced it has purchased 581 bitcoins for an aggregate amount of $40 million (inclusive of fees and expenses).

If you’re not familiar with Semler, it makes medical devices for healthcare providers to combat chronic diseases.

The company’s most recent quarterly filing shows Semler holds $83.8 million in assets on its balance sheet. So bitcoin represents 48% of that.

In a statement released by the company, chairman Eric Semler said the board chose bitcoin because it’s a world-class asset.

Our bitcoin treasury strategy and purchase of bitcoin underscore our belief that bitcoin is a reliable store of value and a compelling investment. Bitcoin is now a major asset class with more than $1 trillion of market value. We believe it has unique characteristics as a scarce and finite asset that can serve as a reasonable inflation hedge and safe haven amid global instability. We also believe its digital, architectural resilience makes it preferable to gold, which has a market value of approximately 10 times that of bitcoin.

Given the gap in value between gold and bitcoin, we believe that bitcoin has the potential to generate outsize returns as it gains increasing acceptance as digital gold. After studying various alternatives, we decided that holding bitcoin would be the best use of our excess cash.

Since announcing their new bitcoin strategy, the stock has risen a mind-melting 37% in one day. And it’s not just U.S. companies getting in on the bitcoin treasury action.

On May 13, Japanese listed firm Metaplanet, announced it was adopting a bitcoin treasury strategy. Since that announcement, its stock has risen a stunning 158%.

Friends, I’ve been predicting for years that this day would come.

As far back as 2020, I wrote that we’d:

see a brand-new area of demand for bitcoin as a corporate treasury asset. It’s incredible. Corporations are sitting on trillions of dollars of capital. So even a small weighting to bitcoin can have a profound effect on the price.”

Today, 41 companies hold bitcoin as a reserve asset on their balance sheets, including MicroStrategy, Tesla, and Block (formerly known as Square).

Semler is just the latest company to jump on the bitcoin bandwagon. Hear me when I tell you: This trend is just getting started.

The biggest incentive in the stock market is the stock’s price. As a corporate insider, think about it logically… If you can double your wealth (or more) overnight just by adding bitcoin to your corporate treasury do you do it?

Of course you do.

Friends, you can get very rich simply by understanding how economic incentives work.

And as you can see, adding bitcoin to your balance sheet can explode the price of your stock higher. That makes adding bitcoin to your company's strategy one heck of a financial incentive.

Nonfinancial companies in the S&P 500 alone hold over $3.6 trillion in cash and cash equivalents on their balance sheet. If just 3% of that moves into bitcoin, that’d translate to $108 billion in buying from S&P 500 companies alone.

I can foresee a future where most major global corporations hold bitcoin on their balance sheets just like they do with stocks and bonds.

Bitcoin Will Go Even Higher

Saylor is on record stating he believes bitcoin is on track to eventually reach $1 million per coin. That’s a 1,360% rise from here.

But let’s be more conservative and assume, like Eric Semler, that bitcoin just matches the market value of gold by the end of the decade.

The value of all the gold in the world is about $13 trillion. Right now, the market value of bitcoin is $1.3 trillion.

So bitcoin would have to move 10x just to match gold.

Let’s say you have $1 million in investable capital and take 5% of it and buy $50,000 worth of BTC.

If bitcoin goes up 10x from here, you’d be sitting on $500,000.

So just a 5% allocation to bitcoin alone could return almost half of your investable capital over the next six years. To put that gain in perspective, it would take you about 30 years to achieve the same return by buying and holding the S&P 500.

Can you now see why I call bitcoin the lowest-risk, highest-reward setup I know of?

Friends, there’s still plenty of upside in bitcoin. Just buy here and let time do the heavy lifting. That’s what the corporations who own it on their balance sheets are doing.

Let the Game Come to You!™

Big T

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