Top Angel Investor Warn Against MicroStrategy Buying Too Much Bitcoin

Renowned as the “World’s Greatest Angel Investor,” Jason Calacanis has recently expressed his apprehensions regarding MicroStrategy’s aggressive Bitcoin acquisition strategy. With the company’s plans to significantly increase their Bitcoin holdings, Calacanis warns that Bitcoin’s fundamental principle of decentralization may be at risk if a single entity accumulates too much of the digital currency. Meanwhile, Bitcoin has shown a 4% increase in value over the past 24 hours, with its market capitalization reaching an impressive $1.94 trillion.

MicroStrategy’s Bold Plan to Acquire All Bitcoin

Under the leadership of Michael Saylor, MicroStrategy has positioned itself as a leading advocate for Bitcoin, steadily expanding its crypto portfolio. The company recently acquired an additional 5,262 BTC for a staggering $561 million, translating to an average purchase price of $106,662 per Bitcoin. This acquisition boosts MicroStrategy’s total Bitcoin holdings to an impressive 444,262 BTC, accounting for roughly 2.2% of the total Bitcoin supply.

The company’s bold declaration of potentially issuing sufficient shares to purchase all circulating Bitcoin has raised eyebrows. Saylor envisions a future where MicroStrategy’s market capitalization could soar to an unprecedented $10 trillion, fueled by a strategic investment of $3 trillion in Bitcoin. This approach is not merely about expanding the company’s asset portfolio but is also a calculated maneuver to fortify their Bitcoin investment.

Michael Saylor is committed to leveraging billions in low-cost capital until MicroStrategy amasses $3 trillion in Bitcoin and achieves a market cap of $10 trillion. Such a valuation would represent a 120-fold increase from current levels.

The Warning on Bitcoin’s Ownership

Amidst these developments, Jason Calacanis has voiced his concerns, highlighting the potential dangers of concentrated Bitcoin ownership by a single entity. He cautions that Bitcoin’s reputation as a decentralized financial instrument could be jeopardized if one company controls a significant portion. In Calacanis’s view, if MicroStrategy’s dominance surpasses 10% of total Bitcoin ownership, it could undermine the fairness and appeal of Bitcoin.

“You break the game of Bitcoin if any one individual owns too much—I’m guessing that number is like 10%,” Calacanis remarked. He further speculates that if Bitcoin becomes perceived as being controlled by specific interests, users might migrate to alternative cryptocurrencies that retain a sense of equity and decentralization. This potential shift could pose a significant threat to Bitcoin’s foundational ethos of openness and equality.

Bitcoin’s Price Update

Bitcoin has recently witnessed a notable price surge, climbing from $95,000 to $98,314—a 4% increase within just 24 hours. This upward momentum suggests Bitcoin might be on the verge of challenging the $100,000 resistance level once more. A successful breakthrough could propel Bitcoin towards its all-time high.

However, it’s important to note that despite the price escalation, the Bitcoin ETF market experienced a significant outflow of $338.4 million on December 24, 2024. The primary contributors to this outflow were IBIT, with a negative flow of $188.7 million, and FBTC, with a negative flow of $83.2 million.

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FAQs

What exactly does MicroStrategy do?

MicroStrategy is a business intelligence firm that specializes in providing analytics and data-driven solutions, spearheaded by CEO Michael Saylor.

Why does MicroStrategy own so much Bitcoin?

MicroStrategy’s substantial Bitcoin holdings are part of a strategic effort to enhance its balance sheet and capitalize on Bitcoin’s growth potential.