Gavin Green on Nostr: An introduction to Bitcoin Strategic Reserves for Companies As we embark on a new ...
An introduction to Bitcoin Strategic Reserves for Companies
As we embark on a new year in 2025, it is worth taking a moment to reflect on a development in 2024.
Corporations, both public and private, have been acquiring bitcoin since 2018. Interestingly, it was the public companies that initially led the charge (over 3400 public companies vs 12 private companies by the end of the year). This trend is surprising especially considering the timing. Remember back in 2018 Bitcoin was a far more speculative and less understood technology. There was no ETF’s, no SEC ruling on Bitcoin as a commodity, FASB laws had not changed, it was a much wilder and uncertain environment in the Bitcoin space. Public companies are often owned by a diverse group of stakeholders, including venture capitalists, other companies, stockholders, and pension funds which tends to result in a more conservative approach to strategy and risk appetite. So, one would have expected private companies to be more adventurous and willing to take risks due to their simpler ownership structure and nimbler decision making.
Feb 2021 had a huge explosion of private companies holding Bitcoin. The number went from 12 to more than 25,000 overnight. While public companies nearly doubled in number over the month of February. This coincides with the early 2021 bull run in the Bitcoin price when it went from $10,000 in Oct 2020 to $61,000 in April 2021.
However, in late 2022, there was a sudden and significant increase in the number of private companies reporting bitcoin ownership. This surge was so substantial that it exceeded the number of public companies holding bitcoin up until that point, almost overnight. The number of private companies went from 25,000 to 367,000 in a two day period. What is interesting about the Bitcoin price at that time was that this was almost the very lowest point in the Bitcoin bear market priced. I have no idea what caused this overnight explosion, but I do suspect it has something to do with reporting or regulatory requirements. It seems unlikely that about 340,000 companies decided to purchase Bitcoin on exactly the same day.
In mid-July 2024 to early August 2024, the number of private companies holding bitcoin dropped by approximately 100,000. At that time the Bitcoin price was trading sideways in the $60,000 range. Following this brief period of decline, both public and private companies experienced slow but steady growth until November 2024 when the bitcoin price broke out of the $60k range for good and went on to hit a new all-time high of $106,000. From then on, both types of companies began to increase their bitcoin holdings rapidly and in tandem with each other, with public companies more than doubling over the next two months.
To summarise we have the following:
Public companies have been more aggressive than private companies
Companies bought bitcoin in a bull run (early 2021)
Companies bought bitcoin in a sever bear market (late 2022)
Companies divested their bitcoin holdings when the price was stable
The only time the number of public companies holding bitcoin went down was between 28th Jun 2022 – 1st July 2022 when the number dropped by 18%, since then it has continued to increase.
The trend is clearly up, on both fronts. Price be damned. And with 2025 being the year it is expected that nation states will announce their own Bitcoin Strategic Reserves, this may well accelerate.
It would be a crying shame if nation states, just like public companies have out run their privately owned compatriots, end up being nimbler and leaving the private sector in their dust.
https://bitcoinforbusiness.io/an-introduction-to-bitcoin-strategic-reserves-for-companies/
As we embark on a new year in 2025, it is worth taking a moment to reflect on a development in 2024.
Corporations, both public and private, have been acquiring bitcoin since 2018. Interestingly, it was the public companies that initially led the charge (over 3400 public companies vs 12 private companies by the end of the year). This trend is surprising especially considering the timing. Remember back in 2018 Bitcoin was a far more speculative and less understood technology. There was no ETF’s, no SEC ruling on Bitcoin as a commodity, FASB laws had not changed, it was a much wilder and uncertain environment in the Bitcoin space. Public companies are often owned by a diverse group of stakeholders, including venture capitalists, other companies, stockholders, and pension funds which tends to result in a more conservative approach to strategy and risk appetite. So, one would have expected private companies to be more adventurous and willing to take risks due to their simpler ownership structure and nimbler decision making.
Feb 2021 had a huge explosion of private companies holding Bitcoin. The number went from 12 to more than 25,000 overnight. While public companies nearly doubled in number over the month of February. This coincides with the early 2021 bull run in the Bitcoin price when it went from $10,000 in Oct 2020 to $61,000 in April 2021.
However, in late 2022, there was a sudden and significant increase in the number of private companies reporting bitcoin ownership. This surge was so substantial that it exceeded the number of public companies holding bitcoin up until that point, almost overnight. The number of private companies went from 25,000 to 367,000 in a two day period. What is interesting about the Bitcoin price at that time was that this was almost the very lowest point in the Bitcoin bear market priced. I have no idea what caused this overnight explosion, but I do suspect it has something to do with reporting or regulatory requirements. It seems unlikely that about 340,000 companies decided to purchase Bitcoin on exactly the same day.
In mid-July 2024 to early August 2024, the number of private companies holding bitcoin dropped by approximately 100,000. At that time the Bitcoin price was trading sideways in the $60,000 range. Following this brief period of decline, both public and private companies experienced slow but steady growth until November 2024 when the bitcoin price broke out of the $60k range for good and went on to hit a new all-time high of $106,000. From then on, both types of companies began to increase their bitcoin holdings rapidly and in tandem with each other, with public companies more than doubling over the next two months.
To summarise we have the following:
Public companies have been more aggressive than private companies
Companies bought bitcoin in a bull run (early 2021)
Companies bought bitcoin in a sever bear market (late 2022)
Companies divested their bitcoin holdings when the price was stable
The only time the number of public companies holding bitcoin went down was between 28th Jun 2022 – 1st July 2022 when the number dropped by 18%, since then it has continued to increase.
The trend is clearly up, on both fronts. Price be damned. And with 2025 being the year it is expected that nation states will announce their own Bitcoin Strategic Reserves, this may well accelerate.
It would be a crying shame if nation states, just like public companies have out run their privately owned compatriots, end up being nimbler and leaving the private sector in their dust.
https://bitcoinforbusiness.io/an-introduction-to-bitcoin-strategic-reserves-for-companies/