Tuesday, 02 January 2024 12:17 GMT

Strategy Doubles Down On Bitcoin Just As The Rest Of The Market Panics


(MENAFN- The Rio Times) In a week when much of the crypto world slipped back into fear, Michael Saylor's company Strategy moved in the opposite direction and doubled down.

Over seven days through Sunday, the firm bought roughly 8,178 bitcoins for about 835.6 million dollars, its largest weekly purchase since July and a transaction approved personally by the founder.

By Strategy's own disclosures, the company now controls close to 650,000 BTC, edging toward 3 percent of the eventual total supply.

The timing is aggressively contrarian. Bitcoin has fallen sharply from its recent highs, ETF flows have turned negative and traders are once again talking about the risk of the price sinking below 90,000 dollars.

On mark-to-market terms, analysts estimate that a large share of Strategy's coins now sit on unrealized losses, with the newest batch quickly moving into the red.

Saylor's answer is that the company can stomach an 80–90 percent drawdown and still function, because debt levels remain manageable and the time horizon is measured in decades, not quarters.



His broader project is to turn Bitcoin into a kind of“national champion” reserve asset for corporations. Strategy actively promotes the idea of“Bitcoin treasury companies”: listed firms that swap excess cash for BTC to protect themselves from inflation and, in theory, boost long-term shareholder value.

The concept is already being copied. In Brazil, Méliuz and OranjeBTC, both listed on B3, have announced strategies that treat Bitcoin holdings as a central part of their corporate identity rather than a side bet. Regulation is quietly catching up.

In Washington, the Genius Act has imposed clear reserve rules on dollar-backed stablecoins, while new Treasury and tax guidance opens the door for exchange-traded crypto products to offer staking yield within the traditional fund framework.

For supporters, this offers a more solid, rules-based environment for digital assets and a potential escape from politicised monetary policy.

Yet the core risk remains simple and concrete: ordinary shareholders now depend on the most volatile major asset in modern markets.

If the“digital gold” thesis holds, firms like Strategy and its Brazilian imitators could emerge as unusually strong, cash-rich players in future cycles.

If it fails, voters, workers and investors will discover how quickly a bold treasury strategy can turn into a one-way, highly leveraged speculation masquerading as corporate prudence.

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The Rio Times

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