In a newly launched memo dated January 13, 2025, Matt Hougan, Chief Funding Officer (CIO) at Bitwise, argues that the phenomenon of firms buying Bitcoin for his or her treasuries is much extra widespread and influential than most traders understand. In accordance with Hougan, “We’ll see tons of of firms purchase Bitcoin for his or her treasuries over the subsequent 12-18 months, and their purchases will elevate your complete Bitcoin market considerably larger.”
Hougan’s memo, titled “Corporations Shopping for Bitcoin: An Ignored Megatrend,” asserts that whereas MicroStrategy and its outspoken founder, Michael Saylor, typically dominate headlines, they’re merely probably the most seen a part of a quickly increasing company motion into BTC.
Regardless of being ranked 220th globally by market capitalization—“a bit greater than Chipotle and a bit smaller than Sherwin-Williams,” in accordance with Hougan—MicroStrategy’s BTC acquisitions considerably exceed your complete new provide of Bitcoin mined final 12 months.
“Final 12 months, MicroStrategy purchased ~257,000 BTC… greater than all of the Bitcoin mined in 2024 (218,829 BTC),” Hougan wrote. He additionally famous that MicroStrategy has introduced plans to boost over $42 billion to buy extra Bitcoin—roughly equal to “about 2.6 years’ price of recent provide” at present manufacturing charges.
Hougan poses a direct query relating to what may occur if “actually large firms begin to take a web page from MicroStrategy’s e book,” pointing particularly to Mark Zuckerberg’s Meta, which he described as “20x the scale of MicroStrategy.”
Whereas MicroStrategy’s strikes have garnered probably the most consideration, Hougan emphasizes that many different firms are already together with BTC on their steadiness sheets. In whole, “70 publicly traded firms personal Bitcoin on their steadiness sheets,” a determine that encompasses each crypto-centric corporations equivalent to Coinbase and Marathon Digital, and mainstream gamers like Block, Tesla, Semler Scientific, and Mercado Libre.
Collectively—excluding MicroStrategy—these firms maintain 141,302 BTC. Personal firms additionally maintain vital quantities of bitcoin. Hougan cites information from BitcoinTreasuries.com displaying that personal corporations like SpaceX and Block.one collectively personal at the least 368,043 BTC. “That’s vital. It implies that, even immediately, MicroStrategy is lower than 50% of the company BTC market,” he wrote, predicting that MicroStrategy’s share “will probably be a small fraction of it will definitely.”
Why Bitcoin Company Adoption Is Set To Explode
Hougan factors to 2 predominant elements which have traditionally constrained company adoption—reputational danger and unfavorable accounting guidelines—and explains why each have shifted quickly.
“Final 12 months, the CEO of 1 massive publicly traded firm confronted big hurdles in including Bitcoin as a treasury asset,” he wrote, describing the persistent concern of detrimental media protection, shareholder lawsuits, and regulatory consideration. “However reputational dangers have peeled again considerably up to now few months. Publish-election, with Washington embracing crypto on the highest ranges, it’s turning into rather more commonplace—and widespread—to personal Bitcoin.”
Hougan then highlights a brand new accounting guideline launched by the Monetary Accounting Requirements Board (FASB) known as ASU 2023-08. Beforehand, BTC was categorized as an “intangible asset” topic to impairment testing, forcing firms to jot down down the worth of their Bitcoin if its worth fell—however by no means permitting them to mark the worth again up if it rose. Now, firms can mark BTC to market and e book a revenue when its worth appreciates.
“If 70 firms have been prepared so as to add Bitcoin to their steadiness sheets when, from an accounting perspective, it actually might solely go down, think about what number of will add it… now,” Hougan wrote. “2 hundred? 5 hundred? A thousand?”
Addressing skepticism as to why firms select to carry BTC, Hougan contends that company motivations largely mirror these of particular person traders. “Some firms are grasping… Others are nervous concerning the debasement of the greenback… Nonetheless others need to sign that they’re a part of the Bitcoin tribe… Some in all probability simply have a hunch,” he wrote.
Finally, nonetheless, Hougan maintains that understanding every firm’s motivations is much less necessary than observing the magnitude of total demand. “You simply want to take a look at the numbers and ask your self two questions: The place does all of this demand from firms appear like it’s going? And what would that imply for the market?”
Hougan’s memo concludes on a bullish be aware, forecasting that if main firms observe the trail paved by MicroStrategy—now aided by extra favorable reputational and accounting climates—the inflow of company capital might considerably push BTC’s worth larger over the course of the approaching 12 months.
“My prediction: We’ll see tons of of firms purchase Bitcoin for his or her treasuries over the subsequent 12-18 months.” – Matt Hougan, Bitwise CIO
At press time, BTC traded at $95,039.
Featured picture from YouTube, chart from TradingView.com