What to buy instead of Bitcoin?

According to Decrypt’s sources, MicroStrategy now has 130,000 BTCs on its balance sheet, which the company spent $3.98 billion to acquire. As of today, the value of those coins has dipped to $2.74 billion, meaning MicroStrategy now has an unrecorded loss of about $1.24 billion.


As a reminder, the company's losses are unrealised, meaning they exist solely on paper. Accordingly, if MicroStrategy does not sell its BTCs and the cryptocurrency's exchange rate rises significantly, then the losses will turn into income. However, all this will only cease to be unrealised when the assets are sold.


Top 5 BTC owners among public companies

Michael Saylor officially stepped down as CEO last month, but he remains formally the head of MicroStrategy. His voice is also important in buying crypto, and here Saylor is even willing to go into debt for the sake of Bitcoin: recall that some of the coins on the balance sheet are purchased against the company’s debentures. Such a risky policy is criticised and even bewildered by many – especially against the backdrop of the prospects that MicroStrategy could get with the acquisition of Etherium.

Blockchain Center published some interesting statistics on the matter. In the chart below, you can see the dynamics of MicroStrategy’s crypto-reserves value when acquiring Bitcoin (in yellow) and Etherium (in blue).

MicroStrategy’s return on investment in Bitcoin and Etherium

That is, recurring purchases of ETH in the same amounts and on the same dates would now give the company a profit of $1.835 billion.

The profitability of MicroStrategy’s investment in Etherium

Moreover, if the company had invested in Ether, the coins could have been used in staking after the altcoin switched to the new Proof-of-Stake (PoS) consensus algorithm. This strategy would have earned MicroStrategy $393.7 million a year at the current stacking profitability of 4 per cent a year.

The profitability of MicroStrategy’s investment in steaking

Even if MicroStrategy now exchanges all of its BTC into ETH, it could earn about $137 million annually from steaking, assuming a stable yield percentage. As a reminder, the profitability of staking depends on the number of people who participate in it. After all, the issue of Etherium for creating a block is fixed, which means that if the number of shakers grows, the reward will be shared between a larger number of users.

The profitability of MicroStrategy’s staking investment

And this is a comparison only with Etherium. There are many other altcoins on the market that have shown much more impressive returns in the past year. Solana SOL, for example, can be highlighted here, which is up 11 thousand percent in 2021. However, investments in them can be considered much riskier than the same Seylor strategy. He himself is still a fan of BTC, and in such circumstances MicroStrategy will only be able to go at least to zero during the next bull run.

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Sailor’s ambition to get hold of as many bitcoins as possible would be endorsed by billionaire and venture capitalist Tim Draper. During his speech at the Web Summit 2022 event, he stated that cryptocurrency is “a good hedging tool against bad governments”, i.e. risk mitigation. In addition, Draper made an unbelievable prediction – according to him, BTC will go up to $250,000 already by the middle of 2023.

It should be noted that Draper has already repeatedly made similar predictions, and they did not come true. So even in this case, the investor's words should be taken with caution.

Billionaire Tim Draper

Such a massive bull run would be triggered mainly by women, Draper believes.

In the case of Bitcoin, it is women who will drive its price to $250,000. The reason is that women form about 80 per cent of retail spending. You can’t buy food, clothing or a place to live with BTCs just yet, but once they become currency, you’ll have no reason to hold on to your fiat currency.


We think the scenario Draper voiced is something out of the realm of fiction. Whatever Bitcoin's growth potential may be, it will not be able to quickly surpass its historical high as early as next year, much less several times over. This seems especially excessive given the current dire macro environment and the steady increase in the US base lending rate, which is still ongoing.

Well, in Seylor's case, it's clear that his limited approach to cryptocurrencies has cost him losses - at least temporarily. That said, other investors should clearly be more flexible and follow trends rather than being solely tied to a single coin.


What do you think about it? Share your opinion in our millionaires’ cryptochat. There we will discuss other important news related to the world of blockchain and decentralisation.