When Microstrategy Inc. bought $425 million bitcoin in the last two months, the idea of investing in cryptocurrency became an important stamp. The American technology company had just made bitcoin its primary reserve asset to hedge against inflation. Now, it seems like major global companies are following the strategy of Microstrategy. Top companies that have adopted Bitcoin as a reserve asset are reviewed here.
The website bitcointreasuries.org is curating bitcoin treasures held in reserve by publicly traded firms globally. Up to date, 13 companies with a combined total 598,237 BTC, or 2.85% of circulating supply, are listed on that page.
Grayscale Investments is an unsurprising pacesetter in this regard. Through its Bitcoin Trust Fund (GBTC), which holds and tracks the price of bitcoin, the New York-based firm now holds 449,596 BTC, which is valued at $5.1 billion currently, and representing 2.14% of the digital asset’s total circulating supply. Listed on the OTCQX market, the Trust has snapped up 70% of all newly minted BTC in 2020, doubling its portfolio in the process.
Microstrategy Inc. — 0.18%
Grayscale may be the leader of companies that adopted bitcoin, but Microstrategy grabbed all the headlines in recent weeks. The Nasdaq-listed firm, which develops mobile software as well as provide cloud-based services, bought $425 million worth of bitcoin in August and September, making BTC as Microstrategy’s largest reserve asset.
It now holds a total 38,250 BTC, in a move that signals increasing corporate adoption. At current exchange rates, the portfolio is worth more than $433 million, so it acquired about $8 million, coming as it does against a backdrop of increased stimulus spending that has sent global fiat money into a tailspin.
Square Inc. — 0.022%
Dorsey’s Square Inc. moved one percent of its total assets into bitcoin. On Oct. 8, the New York Stock Exchange-listed mobile payments firm announced it spent $50 million buying 4,709 BTC. According to Amrita Ahuja, chief financial officer of Square, “bitcoin has the potential to be a more ubiquitous currency in the future”.
The company intends that “as it (bitcoin) grows in adoption, we intend to learn and participate in a disciplined way. For a company that is building products based on a more inclusive future, this investment is a step on that journey.” Bitcoin reacted positively to Square’s purchase, surging 8% in 3 days to more than $11,300 from $10,500. With a market capitalization of over $83 billion, Square provides software and hardware payment solutions. In 2019, the firm reported revenue of $4.7 billion. It has offices in the U.S., Canada, Australia, Japan, and the United Kingdom.
Coinshares — 0.33%
Coinshares Ltd is a U.K.- based investment fund that is primarily focused on direct and indirect exposure to bitcoin and other cryptos. The firm manages over $1 billion in digital assets, with bitcoin making up nearly 80% of that. Coinshares currently holds – on behalf of investors – a total 69,730 Bitcoin, valued at $790 million.
Through its subsidiary XBT Provider, Coinshares provides two globally traded exchange-traded notes (ETNs) in bitcoin and ethereum, Bitcoin Tracker One and BTC Tracker Euro) and ethereum (Ether Tracker One and ETH Tracker Euro). Its ETNs are listed on the Nasdaq Nordic in Stockholm, Sweden and retail investors can buy the instruments. However, the product suffered a blow when the U.K. financial regulator banned the sale of ETNs to retail users in the country a few days ago.
Several other publicly traded companies that have adopted bitcoin are listed on the bitcoin treasuries website. They include bitcoin miners Hut 8 Mining, which trades on the Toronto Stock Exchange (TSX), and Argo Blockchain of the London Stock Exchange. Both hold bitcoin as part of a reserve asset. At the end of June, Hut 8 held 2,954 BTC while Argo Blockchain had 126 BTC by the end of September. Another mining entity, Riot Blockchain, Inc had 1,053 BTC in its reserves in June.
Mike Novogratz’s Galaxy Digital Holdings, a TSX-listed firm that “seeks to institutionalize the digital asset and blockchain space,” owns 16, 651 BTC, worth about $188 million at prevailing market prices. The company offers asset management, investing, advisory and trading services as well as making principal investments. Voyager Digital Ltd, Cypherpunk Holdings, and DigitalX make the list of those public companies holding BTC as a hedge against inflation.