Michael Saylor’s firm, Strategy, is buying over 2,000 BTC daily, far more than miners produce. This aggressive acquisition could create a Bitcoin supply crunch, raising prices. Critics highlight financial risks due to its heavy reliance on debt, while supporters argue this concentration won’t threaten Bitcoin’s integrity. The movement towards hyperbitcoinization could push BTC’s market cap to $200 trillion, according to industry leaders.
In a bold move, Bitcoin analyst Adam Livingston shared insights on how Michael Saylor’s firm, known as Strategy, is essentially creating a synthetic halving of Bitcoin. Each month, the company buys up half or more of the new Bitcoin minted by miners. Miners are currently producing around 450 BTC daily, or about 13,500 in a month, yet Strategy snagged 379,800 BTC in just the last half year.
This means that Strategy is purchasing approximately 2,087 BTC each day, completely outpacing the output from miners. Livingston highlights that as Bitcoin becomes increasingly scarce, gaining access to it is going to drive up costs. Therefore, borrowing or lending Bitcoin might soon transform into an expensive venture only accessible to large entities like nation-states or corporations.
“BTC’s global cost of capital will no longer be the product of market conditions but will instead be dictated by the operational policies of the first Bitcoin superpower: Strategy,” he noted. Livingston is convinced that this shift may lead to a severe shortage of BTC, potentially driving prices skyward if the firm maintains its aggressive buying strategy amid increasing demand.
In related discussions, there’s a movement towards what some are calling hyperbitcoinization. Adam Back, CEO of Blockstream, expressed that Strategy and similar institutions adopting a Bitcoin treasury approach might push BTC’s market capitalisation to an astonishing $200 trillion.
In his comments via X, Back stated that treasury firms are effectively capitalising on the rift between Bitcoin’s potential future and the current fiat ecosystem. However, some critics caution that Strategy’s debt-fuelled Bitcoin accumulation could pose financial risks, especially if a lengthy bear market hits. Concerns about systemic risks due to a single entity holding vast amounts of BTC have also been raised.
Despite these criticisms, Bitcoin advocate Saifedean Ammous believes that the high concentration of Bitcoin with firms like Strategy doesn’t jeopardise the protocol’s integrity. He argues that it’s nearly impossible for these institutions to modify Bitcoin’s maximum supply, as such a move would deeply devalue their assets, directly affecting their shareholders’ interests.
