Bitcoin on the balance sheet can be a superpower, or a potential slow motion disaster.
The difference isn't the price of bitcoin, it's the model. Some companies build disciplined, transparent treasury models that will stand the test of time. Others will chase hype, relying on leverage and share dilution while mistaking noise for signal. Many sit somewhere in between, combining elements of both approaches.
This recent FT piece on Bitcoin treasury companies makes some fair points but misses the real nuance. It opens with a nod to Charles Ponzi and blurs Bitcoin with the broader crypto world (quelle surprise), overlooking Bitcoin’s fundamentally different monetary principles. This framing leads to shallow conclusions, lumping disciplined treasury strategies together with speculative frenzy.
Look at what Strategy, formerly MicroStrategy, has become. Once a software firm, it now exists primarily to accumulate Bitcoin. That "infinite money glitch", issuing equity for Bitcoin, works for them because they are disciplined and capital rich.
Swapping soft money for hard money is an obvious move for any company. It's a rational move in a free market, but in my view, businesses built solely around holding bitcoin, without a solid underlying business, are far from ideal.
Beyond Strategy, some companies build a narrative around Bitcoin, raise significant capital, and drive aggressive marketing to ride the wave of rapidly rising valuations. They may claim a profitable history, and sometimes that is true, but much of the growth comes from momentum rather than proven fundamentals.
This model can work if execution matches ambition and risk is managed well. When the underlying business is not the core driver and Bitcoin is the main attraction, the lack of discipline, resources, or long term credibility leaves these companies speculative and highly exposed to shifts in market confidence.
There will be companies that get it right, solving real problems with a strong risk framework. In a space surrounded by so much hype, it is up to investors and observers to do their own due diligence to understand which strategies are built to last.
The media often misses this distinction. Money alone doesn't equal sustainability.
Bitcoin on the balance sheet can be transformative when it is done with substance and discipline. When it is just noise, it risks collapsing under its own weight and dragging the conversation with it.
And while the FCA continues to force many of us in the UK into proxies, I must admit that watching MicroStrategy's performance has been incredible. It saved my portfolio.
Some companies will stand the test of time because they are solving real problems with sustainable models. Others will fade when the hype dries up. It will be interesting to see how this plays out in the next bear market. Investors will need to do their homework, as not all bitcoin treasury companies are the same.
But hey, at least the FT is starting to notice what's going on. We can't expect them to make a complete 180 turn on Bitcoin overnight.
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