MicroStrategy's Bitcoin Holdings

Business intelligence firm MicroStrategy had been considered a bitcoin proxy of sorts ever since it became the leading corporate holder of bitcoin in August 2020. The company now holds 331,200 BTC, worth roughly $29.7 billion, after a monster purchase of approximately $4.6 billion on Monday — its largest single-day set of transactions yet.

Differentiation Through Yield

MSTR’s ability to generate compounding yield on its bitcoin holdings, enabled by leverage accrued through the repeated tapping of the U.S. capital markets, differentiates its stock from alternative means of gaining exposure to bitcoin such as spot bitcoin ETFs. Benchmark analyst Mark Palmer noted this in a Nov. 18 client report.

Institutional Interest

As retail traders continue to gobble up shares, it's worth examining how the institutional side views MicroStrategy's stock (ticker: MSTR). 13F reports can shed light on how large portfolios and influential money managers navigate the market. It turns out that Wall Street's traditional titans do not want to miss the ride either.

Over the past week, institutional investment managers with at least $100 million in equity assets filed 13F reports with the U.S. Securities and Exchange Commission. These filings offer a glimpse into the managers' stock holdings as of Sept. 30, excluding any short positions.

Total institutional holders of MicroStrategy increased from 667 to 738, with a reported total value of $15.3 billion, according to 13f.info.

Both Vanguard Group, the world's second-largest asset manager, and Capital International Investors bought nearly 16 million MicroStrategy shares each in the third quarter — marking approximately a 1,000% increase in both companies' MSTR holdings. Notably, a Vanguard executive previously expressed skepticism about crypto as a viable asset class, stating the firm would not offer such assets when spot bitcoin ETFs were listed in the U.S.

Morgan Stanley also capitalized on the opportunity, purchasing 8 million shares — reflecting a 500% increase quarter-over-quarter. Goldman Sachs and Bank of America added smaller amounts (696,000 and 766,000 shares, respectively), building upon significant acquisitions from the previous quarter. Additionally, State Street and Susquehanna collectively acquired 5.3 million shares of MSTR.

It’s important to note that these holdings are relatively minor compared to the firms’ larger equities. For example, Vanguard holds 800 million shares of Amazon.

Bitcoin Price Performance

The price of bitcoin is up nearly 110% year-to-date, but this is dwarfed by MicroStrategy shares that have gained 450% in the same time frame, surpassing its previous all-time high.

MicroStrategy's stock recently closed at $384 per share, giving it a market cap of $78 billion.