Michael Saylor, head of MicroStrategy, the first publicly traded company to allocate part of its capital to bitcoin, identified four factors that could entrench the cryptocurrency as a store of value and confirm its status as ‘digital gold’.
In his view, these are:
- Adoption – investors allocate capital to BTC as a savings vehicle;
- Utility – ongoing improvement of the technology underlying digital money;
- Productivity – hodlers invest all of their free cash flows into Bitcoin;
- Inflation – inflation among assets competing with the leading cryptocurrency as a store of value.
The success of #Bitcoin will be a function of Adoption (as Hodlers invest their assets in BTC as a SoV), Utility (as technology makes it harder, smarter, faster, & stronger money), Productivity (as Hodlers invest their free cash flows), & Inflation (of competing assets for SoV).
— Michael Saylor (@michael_saylor) September 27, 2020
In August, MicroStrategy invested about $250 million in cryptocurrency, buying 21 454 BTC. In September the company acquired an additional 16 796 BTC for $175 million.
Later, Saylor revealed details about exactly how the company’s traders purchased a large block of bitcoins, without affecting the price of the cryptocurrency.
Last week, the MicroStrategy head stated that in the coming six months other private firms would follow suit.
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