What happened?
In August 2020, Michael Saylor, then CEO of MicroStrategy (now simply Strategy), made a massive shift by allocating $250 million of the company’s cash reserves into Bitcoin, asserting concerns over inflation risks and dollar weakness. This significant move marked the largest Bitcoin purchase by a public corporation and set a precedent that many others followed, changing the corporate finance landscape.
Who does this affect?
This action directly impacted MicroStrategy as it transformed into Bitcoin’s biggest corporate holder. Beyond the corporation, this paradigm shift affected investors, other corporations, and the cryptocurrency market at large since it intensified the competition for Bitcoin’s limited supply and positioned Bitcoin as a mainstream treasury asset.
Why does this matter?
Michael Saylor’s audacious strategy created a market impact, causing companies to rethink their financial strategies. MicroStrategy continued to accumulate Bitcoin even during downturns, thereby solidifying Bitcoin’s status as a generational store of value. Furthermore, the aggressive accumulation increased the competition for the limited supply of Bitcoin. If more companies start adding Bitcoin to their treasuries like MicroStrategy has done, it could significantly raise the institutional floor, consequently paving the way for Bitcoin’s price to surge exponentially.