Yesterday, MicroStrategy announced that it has purchased an additional 9,245 Bitcoin.
Now the company founded and chaired by Michael Saylor owns a total of more than 214,000 BTC, which is more than 1% of all the Bitcoins that exist and will exist in the world.
Summary
The number of BTC in circulation
In order to give Bitcoin a deflationary nature, Satoshi Nakamoto (the inventor of Bitcoin) set in the protocol itself that there was actually a limit to the BTC that could be created.
In summary, it imposed that initially every miner who managed to validate a block would be given 50 BTC created out of thin air, and that every 210,000 mined blocks this reward would be halved. Since it is explicitly written in the protocol and in the code of the Bitcoin nodes, this rule practically cannot be changed.
And since 1 BTC can only be divided into one hundred million parts, by halving the reward we will reach, around 2140, its cancellation when in theory it should drop below one hundred millionth of a Bitcoin (called Satoshi in slang).
Since all the BTC existing in the world have been created only in this way, that is as a reward for miners, a quick calculation shows that with these criteria there can never be more than 21 million Bitcoins.
Furthermore, up to now more than 19.6 million have already been created in this way, which is more than 93%, therefore there are only a little over 1.5 million left to mine.
Out of the 19.6 million existing BTC, more than 1% is held by MicroStrategy.
MicroStrategy’s purchases
The American company founded and chaired by Michael Saylor began buying BTC in 2020, months before the start of the latest major bull run.
Altogether, to purchase his 214,246 BTC he has invested 7.53 billion dollars, therefore spending an average of about $35,160 per Bitcoin.
The current market value of 1 BTC is over $60,000, so MicroStrategy’s investment in Bitcoin is currently at a potential profit of 79%.
Since it started just under 4 years ago, a +79% return in four years is definitely an interesting return, well above the average that can be obtained, for example, by investing randomly in the stock market.
However, it should be noted that the company’s strategy is not to buy and sell, speculating on price movements. They are not trading, but they are investing for holding purposes.
Actually, given that Saylor has stated that they do not intend to sell BTC, they are doing what is commonly called hodling, a term coined several years ago starting from a typing error, and which over time has come to mean holding indefinitely, that is, without any intention of selling.
Those who HODL simply accumulate BTC and keep them in their wallet, possibly to spend them directly in case of need without selling them.
The other major holders in addition to MicroStrategy
Currently MicroStrategy is the eighth largest holder of Bitcoin in the world, but soon it could climb at least two positions.
At the top of the list is obviously the unattainable Satoshi Nakamoto, with his approximately 1.1 million BTC.
It should be remembered, however, that Nakamoto disappeared in 2011, and never used any of his Bitcoin. It is hypothesized that he died years ago, and did not leave his wallets to anyone, so those BTC should be considered lost forever and should be removed from this count.
It is not even clear how many BTC are actually held by Nakamoto, because they are stored in a multitude of different addresses that are not easily linked to each other and to the creator of Bitcoin.
In second place is the world’s largest crypto exchange, Binance, with almost 548,000 BTC.
However, Binance only holds its clients’ Bitcoins, so it would be incorrect to say that it owns 548,000 BTC. It definitely owns much less.
Third place is held by the crypto exchange Bitfinex with almost 380,000 BTC, but the same considerations made for Binance apply.
At the third place there is the Grayscale ETF (GBTC) with just under 370,000 BTC.
However, it is necessary to specify both that they are rapidly decreasing (just over two months ago they were 620,000), and that by the end of the year it is likely that GBTC will be surpassed by MicroStrategy in terms of the number of BTC held.
Furthermore, the Bitcoins of the Grayscale ETF do not belong to Grayscale, but to the shareholders of the fund who are numerous, since the ETF shares can be purchased by anyone on the stock exchange.
Just below GBTC there is Coinbase, with about 345,000 BTC, but being an exchange it does not hold its own Bitcoin.
Even BlackRock’s ETF (IBIT) owns more BTC than MicroStrategy, 237,000, and moreover it is destined to grow even more from this point of view. However, these BTC are not owned by BlackRock but by the ETF’s shareholders, as in the case of GBTC.
So excluding Satoshi Nakamoto, whose BTC are probably lost forever, there is only one single entity that owns more Bitcoin than MicroStrategy, and that is the government of the USA.
The Bitcoins of the USA
The government of the United States of America over the years has seized many BTC through the Department of Justice.
Currently it would appear to still hold about 215,000, but soon it could be surpassed by MicroStrategy.
Indeed, to date the only source of BTC inflows for the US government are the seizures by the Department of Justice, for now, and in case they do not seize any more, the Bitcoins held by the USA are destined to decrease, since they sell them from time to time.
If, as it seems likely, the BTC of the USA did not increase, while those of MicroStrategy did, soon the company could become the largest single holder in the world of its own Bitcoin, since all the subjects who will hold more or will be holders of BTC that actually belong to others, or have disappeared.
