Microstrategy Has Outperformed All S&P 500 Companies Thanks to Bitcoin

Michael Saylor’s Microstrategy is becoming the corporate finance story of the decade.

The software firm's stock, MSTR, is up more than ten-fold since it began adding Bitcoin to its balance sheet in August 2020. It’s outperformed every single company in the S&P 500 – a feat not even Bitcoin can claim.

Meanwhile, the Magnificent Seven – Apple, Microsoft, Amazon, Alphabet (Google), Meta Platforms (Facebook), Nvidia, and Tesla – have outperformed 96% of the S&P 500.

According to River Financial, Microstrategy currently holds 252,220 BTC worth $16 billion, which makes it the fifth-largest Bitcoin holder. That said, the firm led by permabull Michael Saylor uses Coinbase Institutional custody for its coins.

Saylor might be a polarizing figure, but his mission with Microstrategy could be the most misunderstood story in corporate finance.

Just before the software and business intelligence company began accumulating Bitcoin in droves, its market capitalization was $1.4 billion in August 2020. Fast forward to today, and Microstrategy’s market cap has ballooned to $30 billion, a whopping 2,000% increase, simply by adding Bitcoin as a reserve asset.

Turning the Treasury Strategy Upside Down

In a recent interview, Saylor explained how the company is turning conventional wisdom in finance on its head.

“Conventional wisdom is that the more stock you sell the more you dilute your shareholders,” he said. “Hundreds of thousands of companies have assets on their balance sheets that are dilutive, whereas Bitcoin is the one major asset that is accretive. The more stock we issue or money we raise, the more we accrete.”

Other companies are taking note of Microstrategy’s success. In the Far East, Japanese VC firm Metaplanet has been also selling convertible notes to purchase Bitcoin.

Is this the future of finance, or simply a well-executed fluke? Only time will tell, but for now, Microstrategy’s game plan is panning out.