Bitcoin bulls are buying, hodling, and yanking coins off exchanges
A not-so-micro strategy… Enterprise-software biz MicroStrategy kept up its bitcoin-buying spree last week, snagging 15.4K coins for $1.5B. That brought the value of its BTC stash to $38B — $13.5B of which was purchased over the past month. MicroStrategy exec chair Michael Saylor has said he wants to turn the company into a “bitcoin treasury” and suggested it might never sell its coins. MicroStrategy’s stock has more than 5x’d this year, as some investors viewed it as a way to get exposure to the OG crypto. Others are following Micro’s strategy:
Bitcoin miner MARA Holdings (fka Marathon Digital) snatched up $618M worth of BTC over the past two months.
Three biotech companies recently said they were buying up to $1M worth of BTC as an inflation hedge.
Tesla last month saw the value of its bitcoin holdings pass $1B.
Hodling on… Investors may be taking a cue from MicroStrategy’s crypto stashing. Fresh data shows that exchanges’ bitcoin reserves — coins that exchanges like Coinbase and Kraken hold, often on customers’ behalf — are at a multiyear low. 171K bitcoin have been pulled from exchanges since Trump’s win, suggesting traders are sticking their coins in “cold storage” wallets to self-custody for the long haul. Cold storage is considered a defense against hackers because the physical devices (like Trezor wallets) aren’t connected to the internet. It can also protect investors from losing their coins if exchanges fail (ahem: FTX). But folks who self-custody run the risk of losing their private keys.
“Digital gold” has its shine back… Since its launch, bitcoin has been called “electronic cash,” “magic internet money,” the “future of finance,” and, increasingly, “digital gold.” The idea that bitcoin could act as a store of value akin to actual gold may be winning out. Google Trends show that web searches for “digital gold” hit a record high this month, and the US president-elect has proposed creating a “national bitcoin stockpile.” The counterargument: BTC’s price has moved in tandem with tech stocks.