Digital asset holdings have quickly become the hottest investment vehicle, gaining major mainstream adoption last year as several large US companies announced the addition of Bitcoin to their balance sheets. Whether it is to diversify a portfolio, hedge against inflation or to gain exposure to an emerging asset class, institutions and retail investors in 2022 are all starting to pile in.
Those who are unable to access Bitcoin directly through traditional retirement accounts can gain exposure to digital assets via the stock of publicly traded companies that hold cryptocurrency on their balance sheets. Some of these are directly involved with crypto while others are involved in other businesses but simply hold Bitcoin as an asset.
MicroStrategy Incorporated (MSTR)
Perhaps the most well know Bitcoin proxy, analytics platform company Microstrategy, holds the top spot for a publicly traded firm owning the most Bitcoin, with CEO Michael Saylor adding to its position time and again. The company currently holds nearly 125,000 Bitcoin to date, with an estimated USD value of 5.33 Billion.
Saylor has been using cash flows from MicroStrategy’s main business of selling enterprise software to buy the cryptocurrency. The prominent Bitcoin bull has repeatedly said MicroStrategy will add BTC to its company stockpile for years to come as a hedge against the devaluing US dollar.
Another company headed by a popular Bitcoin supporter, Tesla had invested nearly $1.5 billion in bitcoin in early 2021. The initial investment in BTC was revealed in an SEC filing on Feb. 8, which pushed crypto prices higher. As of January 2022, the electric auto maker owned just over 43k Bitcoin, worth nearly $1.85 billion.
The company had plans in motion to accept Bitcoin as payment for vehicles, but later walked back the plan, citing environmental concerns with mining. Tesla will most likely restart accepting bitcoin as payments once it conducts due diligence on the amount of renewable energy used to mine the currency, according to a statement made by Elon Musk at a conference in July.
Coinbase Global (COIN)
Anyone looking to gain exposure to crypto with a traditional IRA cant help but to consider buying stock in one of the largest US Bitcoin exchanges. Coinbase earns a small transaction fee every time someone places an order to buy or sell a cryptocurrency, making their success contingent on the increase in crypto trading volume.
Aside from facilitating Bitcoin and other altcoin trades, Coinbase aspires to offer a wide range of services, including debit cards, digital asset custody, and a native NFT marketplace. The company also holds Bitcoin of their own, totaling just under 4,500 with a value of $348 million, according to a recent SEC S1 filing.
Block, Inc. (SQ)
The company formerly known as Square was founded by former twitter CEO Jack Dorsey who is a longtime bitcoin bull. In early 2021, the fintech company posted a white paper making the case for why bitcoin is key to a clean energy future – echoing concerns voiced by Elon Musk and Tesla.
Block, Inc. is one of the top Bitcoin “treasuries,” owning about 8,027 bitcoin with a current value of about $344 million. The company’s rebrand was seen as a nod to an increasing focus on blockchain, the technology which underpins cryptocurrencies such as Bitcoin.