Which Institutions Own Bitcoin?


Institutional investment in Bitcoin has been a key driver of the 2020-21 bull market, with the top ten corporate investors alone holding almost 200,000 BTC, or over 1% of total current supply.

2020 was the year everything changed for Bitcoin. In the first half of the year, crypto was – like every other asset – hit by the market turmoil that arose when the severity of the coronavirus pandemic became clear. In March, Bitcoin plunged below $4,000 for the first time since the market had bottomed at $3,100 and begun a new cycle a year earlier.

Critics were quick to say this spelled the end for bitcoin, but digital assets rapidly recovered. By July, BTC had risen above its pre-crash level. Then in August 2020, the first major institutional investors entered the space, and the narrative changed forever.

Fixing the ‘Melting Ice Cube’

The catalyst for institutional investment was Microstrategy, a business intelligence software company led by Michael Saylor. At a time of historically low interest rates, and immense money printing to fund furlough schemes and stimulate an economy devastated by lockdowns, Saylor saw cash as a risky investment. His company held reserves of around $500 million, but no conventional asset looked like an attractive alternative.

‘Once the real yield on our treasury got to more than negative 10%, we realized that everything we are doing on P&L is irrelevant,’ Saylor said, indicating that the impact of inflation outstripped anything they could do to make the business more profitable. ‘We really felt we were on a $500 million melting ice cube.’

His response was to invest the majority of Microstrategy’s half-billion-dollar reserves into bitcoin. In doing so, he became one of the biggest advocates for the digital asset, and paved the way for many other companies to begin diversifying into crypto. 

Today, the top 10 corporate bitcoin investors hold more than 1% of total current BTC supply – with more publicly-traded companies showing interest all the time.

  1. Microstrategy: 105,085 BTC

The original institutional bitcoin investor, and still the largest. Having poured the better part of half a billion dollars into crypto in August and September 2020, Michael Saylor doubled down. The company has repeatedly raised funds specifically for bitcoin purchases, buying more as the price fell from the April 2021 high. The approach worked, with investors proving more than willing to pay for exposure to BTC through Microstrategy. The company’s fortunes – and stock price – are now irrevocably tied to the price of bitcoin. Microstrategy holds over 100,000 BTC, at a current valuation of well over $3 billion.

  1. Tesla: 48,000 BTC

Elon Musk and his electric car company were the biggest bitcoin story of 2021. Musk began showing interest in digital currencies at the start of the year, and in February announced that Tesla would be making a massive purchase of $1.5 billion in BTC. The event catalysed another leg of the bull market, with the price ultimately touching almost $65,000 two months later.

Having bought 48,000 BTC, Musk faced a backlash from the Tesla community about the environmental impact of Bitcoin’s proof-of-work consensus. He paused his commitment to allow customers to buy Tesla’s cars for BTC, sending a shockwave through the market, which assumed he was falling out of love with bitcoin. He also bypassed discussion of the merits of ETH and other cryptos and threw his weight behind the meme crypto, Dogecoin, bewildering and angering many of the Bitcoin faithful – who were also concerned about the amount of influence a single person seemed to have on a supposedly decentralised ecosystem. In short, Musk has been a double-edged sword for Bitcoin.

  1. Galaxy Digital Holdings: 16,402 BTC

A digital asset investment company is a natural candidate for holding crypto, and Galaxy has the largest holdings of any publicly-traded corporation of its kind. Unlike Microstrategy and Tesla, which came to bitcoin relatively late in the day, Galaxy – founded by Bitcoin permabull Mike Novogratz – has been around for long enough that their average buy-in price is well below $10,000 per BTC. Novogratz, who founded the company when he became disillusioned with Wall Street, is a firm believer in bitcoin, predicting in February that BTC would hit $100,000 by the end of the year.

  1. Square: 8,027 BTC

Twitter founder Jack Dorsey has come out as a huge Bitcoin bull, and has integrated crypto into Square, the app launched by the payments company he also founded. It’s a natural step for Square itself to invest in bitcoin, and that’s what Dorsey did – committing $220 million from the company’s reserves to BTC at the end of 2020 and beginning of 2021. 

Dorsey sees bitcoin as the ‘currency of the internet’, and has stated it’s only a matter of time before bitcoin payments via the Lightning Network – which he also helped fund – are integrated into Twitter.

  1. Marathon Patent Group: 4,813 BTC

The Nasdaq-listed crypto mining company picked up almost 5,000 BTC at a price of $31,100 early in 2021. While similar companies have accumulated bitcoin through their own mining activities, Marathon decided to turbocharge their position with a direct investment from their cash reserves. Part of the aim was to make the corporation attractive for Wall Street investors with an appetite for bitcoin, and the $150 million purchase made Marathon the fifth-largest company by BTC holdings.

  1. Hut 8 Mining Corp: 2,851 BTC

Another crypto mining company, Hut 8 made its investment in bitcoin through mining, not purchases – though as the crypto bull market progressed, they committed to retaining a greater percentage of the BTC they mine themselves. Because Hut 8 has been operating since 2011, their average acquisition price has been significantly lower than Marathon and other corporate investors – like Galaxy, averaging somewhere around the $10,000 mark.

  1. Nexon Co: 1,717 BTC

The Japanese-South Korean gaming company made a $100 million bitcoin investment, amounting to almost 2% of cash reserves, in April 2021 – unfortunately at the top of the market. The value of the 1,700 BTC purchased promptly slumped to around half what they paid for it, dragging the company’s share price down with it. Still, Nexon remains one of the largest corporate holders of BTC.

  1. Voyager Digital: 1,239 BTC

The company behind the popular Voyager crypto trading app was founded well before Bitcoin even launched and has had plenty of time to accumulate BTC at low prices. Their 1,200 BTC holdings average around $5,000 per coin, making Voyager one of the smartest institutional investors out there.

  1. Riot Blockchain: 1,175 BTC

Another Bitcoin mining company with a long history in the space, Riot’s 1,175 BTC were picked up at an average price of around $6,000 each – meaning they’re sitting on 500% returns even after the recent crash. 

  1. Aker ASA: 1,170 BTC

With similar holdings to Riot, Norwegian industrial holdings company Aker unfortunately had worse timing, buying almost the top of the market at $50,000. However, the corporation is in it for the long haul, setting up a new division to explore blockchain investment. 

  1. Apple: ?? BTC

With big tech companies like Tesla buying bitcoin, rumours have flourished about others like Facebook and, more recently, Apple following suit. Apple co-founder Steve Wozniak recently described Bitcoin as a ‘mathematical miracle’ that was ‘better than gold’. July saw articles in the mainstream media that Apple may have bought over $2 billion in BTC, though these were fuelled by speculation by Crypto Twitter and have no confirmation from the world’s largest company. Yet...

The future for Bitcoin is institutions – and nations?

With institutional interest in Bitcoin kick-started by fears of inflation, the direction of travel is now clear. Corporations will continue to buy bitcoin. But there may be a major competitor on the horizon, as state-backed crypto activities take off, led by El Salvador. It may not be long before central banks begin holding bitcoin on their balance sheets, providing citizens with the hardest and most inflation-resistant cash that the world has ever seen, as money-printing threatens a race to the bottom for conventional fiat currencies.

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