Bitcoin vs MicroStrategy: Why MSTR stock has surged 500% in 2021

As crypto enthusiasts eagerly anticipate Bitcoin reaching the $100,000 mark, they might also want to take a look at a company that holds nearly 400,000 tokens.

MicroStrategy has been closely tied to Bitcoin ever since co-founder and Executive Chairman Michael Saylor decided to bank on the cryptocurrency in 2020. This move has paid off handsomely, with MicroStrategy’s stock skyrocketing by 513% year-to-date, even after a slight dip from its post-election peak of nearly 700%.

Interestingly, this surge in stock value far outpaces Bitcoin’s gains of around 117% in 2024. MicroStrategy currently boasts a market cap of $87 billion, which is more than double the value of its Bitcoin holdings of 386,700 coins, valued at $37.6 billion based on current prices.

In a recent chat with the Wall Street Journal, Saylor shed light on why MicroStrategy’s stock has outperformed Bitcoin. According to him, the company leverages its Bitcoin holdings to achieve this feat.

MicroStrategy hasn’t shied away from aggressively purchasing Bitcoin, and they’ve been bold in raising funds through stock or debt offerings to acquire even more of the cryptocurrency. Last month, they expanded a convertible notes offering to bolster their buying power, as part of a plan to raise $42 billion through various means over three years to continue their Bitcoin acquisitions.

Despite the company’s success, there are skeptics. Citron Research, for instance, has expressed bullishness on Bitcoin but has chosen to short MicroStrategy. Despite this, they acknowledged Saylor’s visionary strategy while suggesting that MicroStrategy may be overvalued.

Saylor, embracing volatility, remains undeterred by skeptics, recalling his bold decision to embrace Bitcoin in 2020. He remains unfazed, noting that it was a risk worth taking, rather than facing a slow decline.

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