The Retreat of Michael Saylor's Bitcoin Strategy: Imitators Came Under Pressure

The initial euphoria over Michael Saylor's Bitcoin strategy seems to be waning, as the stock prices of some imitating companies have significantly declined over the past month. While the shares of Saylor's "MSTR" fell by about four percent, Bitcoin registered a three percent increase in the same period. However, since entering Bitcoin in 2020, considerable price gains have been achieved, although the recent performance lags behind expectations. Many companies from various industries tried to adapt Saylor's model, but the results are mixed. The Japanese hotel management company Metaplanet had to endure a decline of over 36 percent, while the healthcare data provider Kindly MD suffered an impressive drop of 87 percent. Semler Scientific, a company in the health technology sector, also recorded a decline of nearly twelve percent. Similar fates befell the Trump Media & Technology Group, which struggled with an eight percent loss, and the company founded by Cantor Fitzgerald, which experienced a 17 percent drop and is soon to bring a Bitcoin treasury company to the stock market. Analysts like Gus Galá from Monness, Crespi, Hardt & Co. highlight that the immense influx of companies venturing into the Bitcoin space faces limited investment demand. Despite the introduction of Bitcoin ETFs, institutional investors still prefer to hold stocks rather than Bitcoin directly. This is exemplified by Norway’s sovereign wealth fund Norges Bank, which holds shares of "Strategy" but Bitcoin itself is not found in the portfolio. A notable number of companies have now added Bitcoin to their balance sheets, which K33 Research describes as market saturation. Investors seem particularly skeptical of companies whose market capitalization has fallen below the value of their Bitcoin holdings. The challenges for small businesses emulating Saylor’s strategy remain substantial. While some companies like American Bitcoin and GameStop show positive price developments, many remain convinced that patience and conviction are crucial, especially in turbulent times, as KindlyMD CEO David Bailey emphasized.