It鈥檚 one of crypto鈥檚 hottest trends: publicly traded companies buying and then buying even more.
President Donald Trump鈥檚 media company just announced a to raise $2.5 billion to buy bitcoin, joining a growing number of so-called 鈥渂itcoin treasury companies鈥� as the world鈥檚 most popular cryptocurrency hits .
The companies buy bitcoin for different reasons: Some hold it as a hedge against inflation or to signal support for the cryptocurrency industry, while some firms have made using debt and stock sales to buy bitcoin their primary business strategy.
鈥淭he world at large has no idea what鈥檚 happening and they鈥檙e in for a big shock,鈥� Dylan LeClair, an executive at the Japan-based Metaplanet, which recently went from being a budget hotel firm to a bitcoin treasury company, said at a recent crypto conference. 鈥淭his is a one-way train, nothing is going to stop this.鈥�
The massive increases in some firms鈥� stock price may seem to validate LeClair鈥檚 bravado, but there are plenty of warnings that a downturn in bitcoin鈥檚 prices could lead to large selloffs.
Here鈥檚 a look at bitcoin treasury companies by the numbers:
582,000
That鈥檚 how many bitcoins owned by MicroStrategy 鈥� the undisputed goliath of bitcoin treasury companies.
With nearly 3% of the total bitcoin supply, MicroStrategy owns more bitcoins than every other bitcoin treasury company combined. It also owns more bitcoin than every nation state combined, according to the tracking site bitcointreasuries.net.
Now called Strategy, the software company first started buying bitcoin in 2020 with reserve cash. Now, its software business is a small part of a perpetual bitcoin-buying machine that uses a variety of strategies 鈥� like selling shares or issuing debt 鈥� to keep growing its bitcoin holdings.
More than 3000%
That鈥檚 how much MicroStrategy鈥檚 stock price has increased in the last five years, compared to around 1,000% gain in bitcoin and the 1,500% jump for chipmaker and stock market darling Nvidia during that same period.
The company鈥檚 success has boosted the profile of MicroStrategy鈥檚 founder and chairman, Michael Saylor, who has visited Trump at Mar-a-Lago and the White House while becoming bitcoin鈥檚 enigmatic high priest.
鈥淏itcoin is a swarm of cyber hornets serving the goddess of wisdom, feeding on the fire of truth, exponentially growing ever smarter, faster, and stronger behind a wall of encrypted energy,鈥� Saylor said in a social media .
Saylor鈥檚 success has also spawned many imitators.
鈥淚t鈥檚 kind of shocking 鈥� that it took someone four years after Michael Saylor started doing it to finally do it and pull the trigger and now it feels like everyone鈥檚 pulling the trigger,鈥� said Eric Semler, the chairman of Semler Scientific, a healthcare company that started acquiring bitcoin last year.
$90,000
That鈥檚 the average purchase price of bitcoin for half of the 61 publicly traded bitcoin strategy companies, excluding bitcoin mining companies and bitcoin exchange-traded funds, according to a recent analysis by Standard Chartered.
Geoff Kendrick, the bank鈥檚 head of digital assets research, said in the report that restrictions on investors buying bitcoin directly help explain the popularity of bitcoin treasury companies, as their stocks can serve as bitcoin proxies. But as crypto becomes more mainstream, the case for investing in bitcoin treasury companies becomes weaker, Kendrick said.
He added that bitcoin鈥檚 volatility could force some newer bitcoin treasury companies to sell their holdings to satisfy their debts if it falls under the purchase price.
鈥淭he question then becomes, how much pain can companies withstand before being forced to sell their BTC?鈥� Kendrick said, referring to the symbol for bitcoin.
Triple digits
That鈥檚 how much of a one-day percentage increase in stock prices firms have seen after recently announcing plans to hold other types of cryptocurrencies as corporate treasuries, highlighting how the appetite for such companies extends beyond bitcoin.
SharpLink Gaming, a gambling marketing firm, saw its share price increase by more than 400% after it announced plans to buy up to $425 million in Ethereum, the second most popular form of cryptocurrency. And crypto firm Upexi saw its stock price soar more than 300% after it announced plans to buy $100 million of Solana, a cryptocurrency popular in the meme coin ecosystem.
Alan Suderman, The Associated Press
