Block's bitcoin investment strategy
A new research note on the bitcoin investment strategy employed by Block, Inc. is available.
- Block is a US$40b listed financial technology company that has been actively investing in bitcoin since 2020.
- In its Q1 2024 financial update, the company highlighted why and how it dedicates some of its resources to bitcoin.
- Its new bitcoin investment strategy involves using 10% of the company’s gross profit from bitcoin products to make purchases of bitcoin, every month.
- This dollar-cost averaging (DCA) through P&L approach to investment has some advantages and disadvantages to other approaches.
- This contrasts with the aggressive investment approach used by MicroStrategy of leveraging the corporate balance sheet to acquire bitcoin.
Block, Inc. Q1 2024 shareholder letter
Bitcoin Blueprint For Corporate Balance Sheets
Bitcoin Institutional Report
The inaugural Bitcoin Institutional Report for April 2024 is now available.
Key highlights from the report:
- As of the end of March 2024, 2.45m of bitcoin – valued at US$170b – was estimated to be held by large institutions.
- This represents approximately 12% of the maximum 21m supply of bitcoin.
- The three largest active institutional holders are Grayscale Bitcoin Trust, iShares Bitcoin Trust and MicroStrategy.
- As a category, investment funds were the biggest holders of bitcoin among large institutions at 40% of the institutional total.