As recently as two years ago, most outside the cryptocurrency bubble dismissed the asset class as being speculative and reminiscent of the tulip bubble. This is especially true for high-value investors and major companies, which for obvious reasons, did not want to spread their capital into a volatile asset class. Those companies investing in bitcoin were small in number, and those on the fence simply weren’t convinced that the crypto market was ready.
But much has happened in the past two years, and a snowball effect has taken place, which has brought in a tsunami of capital. Who is buying bitcoin now? Besides a much larger swathe of retail investors, there are now an increasing number of large firms, some publicly traded, and hedge funds allocating some portion of their portfolio towards cryptocurrencies.
Among the many companies investing in bitcoin now are MicroStrategy, Tesla, and Square — but these are the most well-known, and there are actually several other distinct entities buying bitcoin and other assets. We examine these companies, some of which are cryptocurrency companies, and the extent of their investment in bitcoin. We’ll also look at the developments and statements put out by the companies since their initial purchase, to get a sense of where they think the market is going.
Top 11 public companies investing in bitcoin
1. MicroStrategy
MicroStrategy, in many ways, is the premier public company investing in bitcoin. That’s not because they’ve invested the most into it, with a total of $3.1 billion — which is now worth a staggering $5.4 billion. The company holds a total of 114,041 bitcoin, the largest holding of a public company by a considerable margin. That represents about 0.543% of the entire bitcoin supply.
MicroStrategy has made a hefty profit from its investment, and this is so because it was among the first to enter the market. CEO Michael Saylor, who once dismissed bitcoin, is now a great proponent of bitcoin and cryptocurrencies, and believes that BTC is important for diversification. His interest has peaked to the point where he is now a critical member of the Bitcoin Mining Council, a group dedicated to improving bitcoin’s eco-friendliness.
In the months following MicroStrategy’s investments, the firm has released multiple statements describing its hopes and expectations for bitcoin. Saylor says that bitcoin is less risky than gold and is taking the place of digital gold, a trend visible in most of these companies. The company also believes that many more companies will begin investing in the cryptocurrency in the years to come.
2. Coinbase
Coinbase is a bit of an obvious one here. The exchange is among the most well-known in the world and caters to most countries in the world. The company’s public listing this year was one of the highlights of the crypto market in 2021. Rightfully so, as this is the first crypto company to go public, and this has set off a trend of other crypto companies going public.
Coinbase only holds about 4,500 BTC — perhaps small compared to other companies on this list, but significant nonetheless. The cost of this purchase is uncertain, but the current value is $214 million.
The exchange needs little introduction with respect to its efforts in the cryptocurrency space. What is worth noting is the exchange’s focus on global expansion, with multiple offices opening worldwide. Coinbase is also keen on being regulation-compliant and, to that end, has taken various initiatives to sit well with authorities.
3. Tesla
While Microstrategy may be a flag-bearer for public companies investing in bitcoin, Tesla is arguably the most famous. When it announced that it would purchase bitcoin, accompanied by a series of controversial tweets from CEO Elon Musk, it broke the media. Both inside and outside the cryptocurrency world, Tesla’s decision to purchase bitcoin sent shockwaves and brought much attention to the cryptocurrency.
Tesla’s bitcoin holdings amount to an estimated 43,000, which totals at $1.5 billion in purchase costs. That has since gone 1.37x up to $2 billion, making it the second most profitable bitcoin investment from a public company. As one of the hottest new-age companies in the world, Tesla’s investment is rightly one to watch out for and one that could inspire other firms.
Tesla sold 10% of its bitcoin holdings in Q1 2021. Like Saylor of Microstrategy, Elon Musk believes that bitcoin is an alternative to having cash on a balance sheet. He stated that the sale proved the liquidity of bitcoin as an alternative to cash.
4. Square
Payments company Square is no stranger to bitcoin, with the company both purchasing bitcoin and making it a part of its business model. With approximately 8,000 BTC in its coffers, Square holds $382 million worth bitcoin, which was purchased at $220 million. That represents a 1.7x ROI.
Square is potentially the biggest supporter of the asset because of its heavy focus on making bitcoin a part of its business. The company’s Cash App is a convenient way for investors to purchase bitcoin.
Even more significantly, Jack Dorsey announced that Square would launch a DeFi platform. Square is also purchasing Afterpay for $29 billion, an Australian fintech firm, showcasing its interest in the market.
5. Marathon Digital Holdings
Marathon Digital Holdings is a mining-focused company that describes its vision as building the largest mining operations in North America. Mining continues to be critical to bitcoin’s overall development, but the focus has shifted towards clean energy sources. Fred Thiel, Marathon Digital Holdings CEO, has joined the Bitcoin Mining Council to make efforts towards environmentally friendly bitcoin mining.
Marathon Digital Holdings holds 6,665 BTC, purchased at a cost of just under $174 million, which is now worth $317 million. The firm has been putting countless resources into investing in bitcoin miners, as well as purchasing bitcoin, of course.
6. Hut 8 Mining
HUT 8 Mining is another bitcoin mining-focused company, concentrating on North America. It claims that it is the top hodler of self-mined bitcoin in the region. The firm employs novel technologies for its mining efforts and has experienced good growth on its capital.
HUT 8 Mining owns about 4,450 bitcoin — but has actually received the best ROI on its bitcoin investment among the top 11 public companies investing in bitcoin. It purchased its bitcoin holdings for a comparatively low $39 million, which has experienced a 5.4x jump to over $200 million, thanks to the bitcoin price bump over the years.
Most recently, the company purchased $30 million worth of NVIDIA GPUs to mine various assets. Little has happened in the way of significant headlines since then, but it continues to move firmly forward with its mining operations.
7. Galaxy Digital Holdings
Galaxy Digital Holdings is one of the major players in the institutional investment market, led by its charismatic CEO Michael Novogratz. The latter has not stopped championing digital assets and what it could do economically for both individuals and businesses.
Galaxy Digital holds about 16,400 BTC purchased for a reported $190 million, though there are conflicting reports on this. The total value now stands at $783 million.
Bitcoin price increase since its purchase has led to Galaxy Digital being one of the top gainers among publicly traded companies.
Galaxy Digital offers several crypto-based funds for its clients, and bitcoin is not the only interest of the company. Other funds include an ethereum fund and a DeFi index fund. The company has over $1.2 billion in assets under management and has been successful with its business, with Q1 2021 net income doubling.
8. Voyager Digital
Voyager Digital is a brokerage firm that has been in operation since 1993. Its subsidiary Voyager Digital Holdings was launched to offer services in the crypto market. The firm offers over 60 crypto assets to trade, with attractive rewards to incentivize users to use the platform.
The company holds approximately 12,260 BTC, which is now worth around $585 million. It has done well with its crypto brokerage business, racking up a quarterly revenue of $60.4 million in May 2021.
9. Bitcoin Group SE
Bitcoin Group SE is a venture capital firm that is based in Germany. It has performed well business-wise since Germany’s lawmakers made laws more amenable to cryptocurrencies. The nation has allowed crypto investment with institutional funds, besides drafting a law for tokenized blockchain securities.
Bitcoin Group SE has just under 4,000 BTC on its balance sheet, which is worth $188 million at today’s prices. It was purchased at $126 million, representing a good ROI on its investment.
10. Riot Blockchain
Riot Blockchain is a bitcoin mining company with a strong focus on the North American market, like the other mining companies on this list. The firm has mining facilities in Texas and New York, with a hash rate of 2.2 EH/s utilizing approximately 73 megawatts (MW) of energy.
Riot Blockchain bought the largest bitcoin hosting facility in the U.S. for $651 million in a bid to boost its mining operations in the area. Alongside this, it has purchased 15,000 miners to boost operations and bump up its hash rate.
The firm has 2,687 BTC, which is valued at $128 million. With its focus on mining bitcoin, this figure is only likely to increase.
11. Bitfarms
Bitfarms is a blockchain infrastructure company that runs a cryptocurrency mining operation in North America. The company has a much stronger focus on using clean energy, utilizing hydroelectricity to operate its five facilities in Quebec, Canada.
Its mining operations have been successful, with Q3’s bitcoin production up to 1,050 BTC. Bitcoin revenue for Q1 2021 also saw a massive increase of 209%. No doubt that this was helped by its purchase of miners, including 48,00 MicroBT miners in Mar. 2021.
More public companies will invest in bitcoin
This list of publicly traded companies investing in bitcoin is impressive by any standard. What is even more remarkable is how quickly the market has turned around in a few years, convincing these firms to put in their money.
The fact that more companies are coming in will only create a snowball effect that brings even more companies, so the ball is rolling well at this point. We can probably expect more major companies to invest in bitcoin, though this will depend heavily on regulation and, to a lesser degree, on bitcoin’s price. Cryptocurrency companies themselves will also benefit greatly from this influx of new funds.
It seems more like crypto is a good reserve for companies wishing to diversify their portfolio. At long last, the market is now cementing itself with the arrival of these established firms and institutional investors. As for who is buying bitcoin now, one need only take a look at the headlines — inevitably, there will be more to come in the near future.
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