TL;DR

• A $16.5M investment in Bitcoin as a treasury asset has added $24B to Metplanet’s total market value — a strategy that will degrade as more companies adopt it, but still support BTC’s price over time.

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In middle school, we discovered an infinite-passing grade glitch:

Take the required assessment work, and make a movie out of it.

E.g. Chevy and his friends passed their 8th grade sociology group project on Vikings, by filming themselves sword fighting with sticks and quoting lines from their textbooks.

It worked not because the work was good (it was comically bad), but because filming and cutting together footage took a lot more effort back in the mid 2000’s — enough that most teachers couldn’t bring themselves to not give them a passing grade, just for the perceived ingenuity.

But then iPhones came along and ruined it all by making recording/editing multimedia presentations that much easier (thanks a lot Steve Jobs).

We’re telling you this because there’s a parallel that currently exists in the crypto world.

A temporary tactic that is pumping company valuations, but will soon become less effective as it is further adopted.

That is: companies holding Bitcoin in their treasury.

MicroStrategy ($MSTR) was the first to do it, buying up 1% of all BTC in the world between Aug 2020 and now — seeing its stock price move 14x in the same period.

(As investors bought $MSTR stock as a roundabout way of buying Bitcoin, while avoiding any regulatory issues).

And now the same thing is happening to the Japanese firm, Metaplanet, as they have adopted the same strategy.

In fact, their stock price just jumped 20% after they announced they’d purchased even more Bitcoin.

What’s crazier is, their stock price is up a cool 9x since they adopted Bitcoin back in April, with a total treasury holding of (a measly) $16.5M worth of BTC.

Here’s the math on that:

A $16.5M investment in Bitcoin has added $24B to Metplanet’s total market cap.

And while more and more companies adopting this strategy will lead to the strategy’s returns degrading over time, one factor will stay unchanged:

More adoption = more positive effects on Bitcoin’s price.