For decades, corporate treasuries have depended on cash, bonds, and short-term investments to safeguard their capital. However, factors like inflation and low interest rates have challenged this strategy. A newcomer is beginning to redefine corporate finance.

BTC as a Corporate Reserve Asset

Traditionally, corporations held substantial cash reserves to ensure stability and liquidity. As Michael Saylor, Executive Chairman of MicroStrategy, expressed, cash resembles a melting ice cube due to its diminishing purchasing power. Bitcoin presents a viable alternative, offering fixed supply and global liquidity.

Since 2020, MicroStrategy has been acquiring Bitcoin aggressively, transforming its balance sheet into a sort of BTC bank. The company has issued convertible debt and equity to fund its purchases. In 2024, it acquired 257,000 BTC, turning MicroStrategy into a publicly traded Bitcoin ETF.

Two Key Metrics: Bitcoin per Share & BTC Yield

Bitcoin per share (BPS): The number of Bitcoin held per outstanding share, allowing investors to gauge a company’s indirect BTC exposure.

BTC yield: The percentage change in Bitcoin per share over time that indicates the efficiency of a company’s BTC acquisition strategy.

The Corporate Supercycle

While many firms continue with traditional treasury strategies, a significant shift is underway. Over 70 public companies are now incorporating Bitcoin into their balance sheets, including Tesla, Coinbase, and Block. This adaptation signifies more than just a trend; it reflects how companies can enhance shareholder value in a digitally scarce era. Regulatory changes, like SAB21’s reversal, have enhanced Bitcoin’s appeal as a treasury asset, paving the way for wider adoption.

The era of corporate finance is evolving, with Bitcoin offering companies new ways to create and preserve value in their treasury management. Those who adapt to this change will likely lead in the digital landscape.