Billion $$$ Bitcoin Buyers

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Let’s just cut to the chase; you may very well own Bitcoin and not even know it.

In fact, you would not be alone. Investors around the world may own Bitcoin and would be stunned/happy/ excited/panicked (pick one) to actually realize that. How, you ask? You looked in your wallet and saw only cash and credit cards. No Bitcoin. You are pretty sure you didn’t open one of those “new” cold or hot wallets you have heard about. So, again, how?

Well, here ya go. With some recent HUGE purchases, several publicly traded companies have added to their cash reserves (dry powder) by holding Bitcoin. In fact, some 13 companies/funds now own roughly $7 Billion of Bitcoin which equates to almost 3% of the total supply of Bitcoin. So, if you own Square, MicroStrategy, Galaxy Digital Holdings or Grayscale Bitcoin Trust you are in Bitcoin. To be sure, that is indirectly, but still…..you’ve got some Bitcoin. Even every citizen of Norway is in Bitcoin via Norway’s Oil Fund (a sovereign wealth fund of sorts) that is ultimately owned by Norway’s citizens.

Co-founder Jack Dorsey of payments company Square (an ardent Bitcoin advocate) was the most recent active buyer for Square’s cash reserves. Square purchased 4,700 Bitcoins worth around $50M USD, or just under 1% of their cash stockpile, to diversify their holdings. Quoting a bit from Square’s whitepaper released last week;

“We view bitcoin as an instrument of global economic empowerment; it is a way for individuals around the world to participate in a global monetary system and secure their own financial future.”

Have some MicroStrategy in you portfolio? You got Bitcoin. With two large purchases, CEO Michael Saylor bought a total of 32,250 Bitcoins ($425M) to, again, diversify cash reserves, putting MicroStrategy at the top of the list (#1!) of public companies holding Bitcoin. Keep in mind, BlackRock and Vanguard (among others, of course) own MicroStrategy thus making all of their shareholders/investors owning a “bit o’ Bitcoin”. Norway’s Oil Fund – referenced above – owns 2% of MicroStrategy, thus making every Norwegian a holder in Bitcoin.

The really big takeaway here is that not only are institutions diversifying into the crypto sector (mostly Bitcoin) but now public companies are jumping in as well. With only 21 million POSSIBLE bitcoins to be “mined,” and larger buyers accumulating the digital store of value in ever larger blocks…….well, economics 101 (supply and demand) come into focus. Looking into the future and thinking.

Oh, side note; after Square announced its Bitcoin purchases the stock rose over 1.5%.

A trend developing?