While at least 26 publicly traded companies hold bitcoin, just one owns more than half of all cryptocurrency on corporate balance sheets.
It’s not Tesla, the electric car manufacturer that accepts bitcoin as payment and is run by a CEO who promotes cryptocurrencies so aggressively his tweets are under SEC investigation. Nor is it Square, the financial services company led by ex-Twitter CEO Jack Dorsey, who famously lists only “#bitcoin” in his Twitter bio.
The biggest corporate bitcoin holder is the Virginia-based business intelligence software maker MicroStrategy, according to a database from the crypto analytics firm CoinGecko. The $3.6-billion company owns 121,044 bitcoin, a crypto horde roughly 2.5 times larger than its nearest contender, Tesla. MicroStrategy’s bitcoin is now worth roughly $4.4 billion–which is about 25% more than the company’s market capitalization.
MicroStrategy bought its first tranche of bitcoin in August 2020, citing worries that the US dollar would lose value thanks to the pandemic, financial stimulus measures from governments around the world, and global political uncertainty. “This investment reflects our belief that bitcoin, as the world’s most widely-adopted cryptocurrency, is a dependable store of value and an attractive investment asset with more long-term appreciation potential than holding cash,” CEO Michael Saylor wrote in a statement at the time.
MicroStrategy has since spent more than $3.5 billion on bitcoin, and its investment has paid off so far. Despite the recent crash in cryptocurrency prices, MicroStrategy’s bitcoin reserve is worth nearly $850 million more than what it paid, as of Jan. 27. The firm vowed to continue buying bitcoin amid the selloff that has seen the cryptocurrency lose 46% of its value.
Oil investors are now betting on bitcoin
Most publicly traded companies holding bitcoin already deal in cryptocurrency: They run exchanges, mining operations, or digital asset investment firms. But firms in unrelated industries are betting their balance sheets on the volatile asset class, too. Nexon, the Korean video game developer, plowed $100 million into bitcoin last April, arguing that the cryptocurrency “offers long-term stability and liquidity while maintaining the value of our cash for future investments,” in a statement announcing the purchase. By August, Nexon had written $40 million off its bitcoin investment, causing the company to miss its quarterly profit target.
Meitu, the Chinese developer of a popular photo editing app, has spent $50 million on bitcoin since March 2021. “The board believes cryptocurrencies have ample room for appreciation in value and by allocating part of its treasury in cryptocurrencies can also serve as a diversification to holding cash (which is subject to depreciation pressure due to aggressive increases in money supply by central banks globally) in treasury management,” Meitu said in a statement (pdf). The company has lost $15 million on its bitcoin investment, as of Jan. 27.
Some traditional investment firms are also buying into bitcoin. Aker ASA, a Norwegian industrial investment company founded in 1841 which traditionally invests in fossil fuels, launched a cryptocurrency-focused subsidiary named Seetee in March 2021. It has spent nearly $60 million on bitcoin. “We are very excited about the industrial opportunities that will be unlocked by Bitcoin and blockchain technology, and want to contribute forcefully to that effort,” Aker CEO ?yvind Eriksen said in a statement announcing Seetee’s launch. So far, the firm has lost $16 million on its bitcoin investment.
But the news is not bad for all investors. Investment firms specializing in cryptocurrency have performed better. Because they bought in early and held their reserves throughout bitcoin’s wild spikes and crashes in 2021, they have gotten the best returns among public companies. These firms, while owning just 8% of bitcoin on public companies’ balance sheets, account for 28% of the (unrealized) gains.