Corporate Bitcoin Holders to Rise as Accounting Rules Change
MicroStrategy’s broad BTC strategy has opened the door to a “bona fide megatrend” in corporate adoption, according to Matt Hougan, Chief Investment Officer at Bitwise. He forecasts a rapid acceleration in the number of corporations placing BTC on their balance sheets, driven by changes in accounting rules and a shift in regulatory sentiment in the U.S.
MicroStrategy: Leading the Bitcoin Megatrend
This has made MicroStrategy, with its bold acquisition of now over 450,000 BTC valued at $43 billion, a leader. Executive Chairman Michael Saylor announced plans to acquire an additional $42 billion in BTC, a sum equivalent to nearly three years’ worth of new BTC supply.
This not only underlines Saylor’s confidence in BTC future but also places MicroStrategy as an example for other corporations looking to make the cryptocurrency an asset reserve.
Accounting Rule Changes Fuel Adoption
Recent changes by the FASB under ASU 2023-08 have made holding BTC more attractive for corporations. These new rules allow companies to account for price increases along with declines, in contrast to prior regulations that treated BTC solely as an intangible asset.
This shift significantly reduces the financial and reputational risks associated with holding Bitcoin,” said Hougan. The change has opened the door for more firms to consider Bitcoin as a viable addition to their treasuries.
Institutional Momentum Gaining Strength
He points to a growing wave of institutional adoption, partly driven by the success of spot Bitcoin ETFs and greater regulatory clarity in the U.S. About 70 companies had put Bitcoin on their balance sheets under the previous accounting framework, he said.
“With the new and improved reporting standards, it’s not hard to imagine hundreds or thousands of companies adding Bitcoin as a strategic asset,” said Hougan.
A Bright Future for Bitcoin as a Reserve Asset
As corporate interest in BTC grows, its transition from speculative investment to mainstream reserve asset becomes more and more clear. MicroStrategy’s approach, coupled with evolving regulatory and financial frameworks, signals a transformative era for corporate adoption.
With institutional momentum building, BTCis poised to redefine corporate treasury strategies, making it an indispensable asset for the forward-thinking company.
