First MicroStrategy, then Square, Inc., Who’ll Be Next to Buy Bitcoin?
It has come as no surprise to any Bitcoiner that corporate money is entering the space, but the amount of money coming in has rocked the world.
MicroStrategy were the first major corporation to buy Bitcoin. Earlier this summer the software firm announced it had spent $425m getting hold of 38,250 bitcoins, becoming the vast majority of its treasury.
MicroStrategy CEO Michael Saylor said at the time, that he looked at the state of the macroeconomy, and likened MicroStrategy’s treasury of $500m in cash to ‘a melting ice cube.’
Saylor said he did months of homework on Bitcoin, and quickly made his decision to buy Bitcoin instead of seeing MicroStrategy’s ‘ice cube melt away at 10% a year’.
Square, Inc. followed shortly after announcing on Thursday it had bought 4,709 bitcoins for an aggregate price of $50m.
The payments company also laid blame on the state of the economy as it looked to store its value in a safe haven.
‘Given the rapid evolution of cryptocurrency and unprecedented uncertainty from a macroeconomic and currency regime perspective, we believe now is the right time for us to expand our largely USD-denominated balance sheet and make a meaningful investment in bitcoin,’ said a Square spokesperson.
And not forgetting Grayscale (GBTC) Bitcoin fund. It was launched back in 2013, and the fund has been accumulating bitcoins ever since.
GBTC is today worth $4.9 billion, so dividing their AUM by a price of $11,000, we can determine Grayscale has roughly 445,000 bitcoins in its trust.
With these three significant amounts of public money invested in Bitcoin, we ask which corporation will be next to buy Bitcoin?
Which major corporation will be next to use its ‘melting ice cube’ to buy Bitcoin?
After MicroStrategy legitimized and paved the way for all public companies to look at Bitcoin, there’s no doubt every boardroom is discussing the idea of buying some.
So, which major corporation will be next?
Square Inc. CEO is Jack Dorsey, and he is also CEO of Twitter, so Twitter making a move into Bitcoin wouldn’t come as a surprise to anyone.
Jack Dorsey is a well-known Bitcoin advocate, and his Twitter bio is one word: #Bitcoin.
Dorsey has personally invested in Bitcoin and is on record as saying, ‘Bitcoin will eventually be the single global currency’.
So with Jack so bullish on Bitcoin the only thing likely holding him and Twitter back is the pressure of making the decisions for such a big treasury.
Twitter has $7.8 billion cash on its balance sheet, and its clear where Jack sees the future of money, but of course it’s not only his decision.
Twitter’s biggest shareholders are Vanguard and BlackRock who own a combined 17% of the social media giant.
Tellingly, however, both of them own the biggest stake in MicroStrategy after Michael Saylor.
Jack Dorsey doesn’t have the same influence in the Twitter boardroom as Saylor does at MicroStrategy, and his tenure as Twitter CEO is regularly questioned, so it wouldn’t be as easy for Jack to buy Bitcoin with the Twitter ‘ice cube’.
Fidelity is a likely candidate to be the next corporation to purchase Bitcoin, according to Max Keiser.
Speaking on the Swan Lounge podcast, Keiser said Fidelity had been involved in the Bitcoin space for years and were a growing presence, thereore thought it a likely candidate to be the next.
The financial giant has long been partaking in the Bitcoin scene through its mining operations, and with rumours of an imminent Bitcoin fund, a large purchase of Bitcoin wouldn’t be a shock.
With $3.3 trillion AUM Fidelity is one of the giants of the legacy financial world, and it launched its subsidiary Fidelity Digital Assets back in 2018.
However, the financial giant has been mining Bitcoin since as early as 2015, saying it had taken to the mining industry ‘in the spirit of learning’ but had actually ‘made a lot of money’.
And with Fidelity rolling out its institutional custody solutions and other Bitcoin related offerings, a large purchase of Bitcoin would make sense.
What About FAANG Stocks?
Many believe tech savvy Faang stocks will be the next to buy Bitcoin.
No doubt they’ll have a better understanding of Bitcoin than the likes of BP, Exxon or McDonalds, so it would be no shock if they did.
Each FAANG has so much cash in their treasury, they wouldn’t even have to declare a purchase of hundreds of millions, according to wealth manager Andy Edstrom.
Speaking on the Swan Lounge Podcast, Edstrom said the material threshold would allow FAANGs to buy hundreds of millions of dollars worth of Bitcoin without having to consult their board.
‘Because of the material threshold, hundreds of millions and probably billions worth of Bitcoin could be bought by Faang and they wouldn’t even need to disclose it,’ said Edstrom.
Discussing the idea of FAANGs, Swan Bitcoin founder and CEO Cory Klippsten said he believed the most likely to buy Bitcoin would be Microsoft.
klippsten quickly dismissed the idea of Facebook getting into the space, saying Zuckerberg couldn’t do anything more ‘to rankle anybody ever’ after being ‘so evil for so long.’
The serial angel investor believes Apple has too much money to worry about Bitcoin, but said if Elon Musk was to announce he was buying some Bitcoin, it could sway Sergey and Larry at Google.
Amazon being a platform for transacting value makes sense and Klippsten believes they could possibly be the first FAANG to declare they were making Bitcoin part of its treasury, but Microsoft was the most likely.
‘Microsoft it makes most strategic sense for,’ said the Swan Bitcoin founder. ‘They’re in software purely, they’re international, they could use the PR, they’re already into open source software so it would make most sense for them in the short term.’
Slowly at First, Then All at Once
Bitcoin is only eleven years old, and it is already bigger than most national currencies. The president of the United States has openly discussed it, and buying some is now on the agenda of every boardroom in New York, London and Singapore.
Gigachad Michael Saylor made the world take notice. Not that many weren’t before, but those that rubbished the idea, are now having to take notice.
Retail got into an asset class before Wall Street for the first time ever, because Bitcoin was created to democratise the financial system and ensure inclusion for everyone.
After a torrid couple of years since the highs of December 2017, Bitcoin is now ready to gobble more value from the legacy financial system.
The 2018 narrative was ‘year of the institution’, remember? Well it might be two years later but 2020 is definitely turning out to be so.
But 2020 might turn out to be a warm up for: 2021 Year Institutional Money Swamped Bitcoin.
Author: Tommy Limpitlaw
Where can I buy Bitcoin in Nigeria?
There are several reputable Bitcoin exchanges operating in Nigeria. However, the most recommended exchanges are Kraken or BlockFi. Or you can buy Bitcoin from Bitcoin marketplaces, such as LocalBitcoins or Paxful.
All of these exchanges and marketplaces are global with high liquidity and excellent customer service. Check out our reviews on each platform.
Can you buy less than 1 Bitcoin?
Yes. Every Bitcoin can broken down into 100 million bits. They are known as satoshis, after the pseudonymous creator Satoshi Nakamoto. And some companies will let you buy as little as $1 worth of Bitcoin, which at time of writing is worth about 11,000 satoshis. There are many companies that have a system for dollar cost averaging (DCA). This is a great way to buy Bitcoin, and is known in the space as ‘Stacking Sats’. Basically, what you do is set up small automatic, recurring payments to buy Bitcoin (or sats), and you DCA over time.
How can I earn free Bitcoin?
Nothing is really free, because even when you earn free Bitcoins you’re giving up your time, which is precious. But you can earn free Bitcoins. If you are a gamer, there are games like Bitcoin Bounty Hunt where you shoot your way to Bitcoin riches. Or there’s Carrot – a platform where you can earn free Bitcoin for doing tasks. Or you can save your Bitcoin in an interest bearing account and earn some Bitcoin interest. Be careful with interest bearing accounts, and only go with legitimate companies, though. I recommend Blockfi, you can read the review here.
Why should I buy Bitcoin?
People who understand Bitcoin buy Bitcoin because it is a peer-to-peer money that nobody can manipulate. It’s all set in the Bitcoin codebase which is secured by hundreds of thousands of computers all around the world. Bitcoins can be sent by anybody and no third party is need to verify the transactions, and nobody can stop Bitcoins being sent. There are many more reasons why people buy Bitcoin, and a deeper dive before doing so is recommended.