Strategy leads the trend, a detailed explanation of the BTC reserve strategy company investment guide

Since BTC has been rising all the way since last year, and with the favorable relaxation of encryption regulation under Trump's administration, many companies have followed suit. Strategy (, originally known as Microstrategy), has implemented a BTC reserve strategy. 78 listed companies globally, including mining enterprises, pharmaceutical companies, and advertisers, are buying BTC to replace their cash reserves. Many companies have turned the tables and their stock prices have skyrocketed by tens of times. Can these companies still be invested in? How to evaluate their value? And how to invest in overseas stocks?

Bitcoin Treasury Reserve Policy (What is BTC Reserve Strategy )?

MicroStrategy, the first to propose the BTC reserve strategy (, has recently been renamed Strategy). As early as September 2020, it announced the Treasury Reserve Policy, which is a policy that uses BTC as the company's primary reserve asset. In addition to using cash flow generated by its core business, the company continues to buy BTC by raising funds through debt and equity financing transactions.

MicroStrategy's co-founder Michael Saylor is a faithful believer in BTC, and has repeatedly publicly stated that BTC is digital gold and the scarcest asset in the world.

Michael Saylor believes that the strategy of buying BTC can enhance the company's reputation, and the increase in the company's core software revenue can allow MicroStrategy to buy more BTC, creating a virtuous cycle and serving as the main strategy for MicroStrategy.

How to evaluate the value of a company's BTC reserve strategy?

Most companies that invest in BTC strategies are so-called 'zombie companies', whose core business is not profitable, so it is difficult to measure with traditional financial indicators. Such strategies are usually used for small businesses, so although Saylor has been vigorously promoting large companies such as Microsoft to invest in BTC recently, it has not been effective.

The author attempts to assess the value of BTC reserve strategy companies with the following indicators and factors for reference.

B/M ratio BTC accounts for company market value ratio

We calculate the B/M ratio by dividing the value of BTC held by the company by the company's market value.

Market Cap = Share Price * Total Circulating Shares

BTC Value = BTC Price \ * The amount of BTC held by the company

This represents BTC as a percentage of the company's market capitalization.

P/B ratio Price-to-Book ratio

Traditional finance uses the Price-Book Ratio, PB, to evaluate the stock price of a company. P/B ratio is the ratio of stock price to net asset value per share, where net value represents the actual value or liquidation value of the company. If we do not consider other assets of the company and simply use Bitcoin value to represent the liquidation value of the company, we can also obtain a P/B ratio, after all, most BTC reserve strategy companies are not profitable! Including Strategy.

P/B ratio=price per share/BTC value per share

This value can also correspond to the BTC return rate proposed by the Strategy. The BTC return rate is the ratio of BTC held by the company to its diluted circulating shares, that is, the proportion of BTC held per share. However, this BTC return rate does not consider the price of BTC, purely from the perspective of shareholders, the speed at which BTC increases without increasing shareholding.

The concept of P/B ratio we use here is the same as in traditional stock analysis, the higher the number, the more expensive the company's stock price is.

Assessment of the company's core business

In addition to the above two indicators, the author also suggests incorporating an evaluation of the company's core business, including:

Is the company profitable in its core business?

Is the company's core business related to Bitcoin?

Does the country where the company is located have tax advantages?

In addition, does the country's tax system increase investors' willingness to buy company stocks more than BTC?

In Japan, capital gains from direct purchase of BTC are subject to a tax of up to 55%, so investing in stocks such as Metaplanet through individual savings account (NISA) is a cheap and convenient option for small-scale and first-time buyers.

In the United States, BTC also needs to be included in property transaction income tax, although stock trading also requires high capital gains tax, especially for short-term traders (, but if this company's stock can be included in a retirement account, it can enjoy tax advantages, provided that it must be held for the long term.

Hong Kong itself does not impose capital gains tax on stocks, and relevant regulations on encryption have not yet been introduced, so the differences between the two may not be significant.

List of BTC Reserve Strategy companies

I have organized several companies and listed them with our own indicators as follows:

B/M ratio

P/B ratio

Core business bonus: The standard is to make money in the core business ) based on the latest financial report ( and whether the core business is related to Bitcoin, those who meet the criteria will each receive an additional +

National tax system: Japan++, USA+ ) if can be included in retirement account (, while Hong Kong has no tax advantages

From the table below, it can be seen that Japan's Metaplanet benefits from tax advantages, with a P/B ratio as high as 8. Metaplanet's newly issued financial report has seen its first profit in six years, and the operated hotel will also be renamed as 'BTC Hotel', with BTC gallery, art museum, and shared workspace set up in the hotel, providing a good communication environment for the encryption community. It is evident that both its core business and tax system have attracted the attention of investors, pushing the price to extremely high levels.

For information about related companies, please refer to:

MicroStrategy from Zero: The Transformational Path from Business Intelligence )BI( to BTC Empire

Boya Interactive actively invests in Web3, making it the listed company in Hong Kong with the most BTC holdings.

Metaplanet financial reports welcome profits, and options create BTC returns as an important source of profit

How to invest in an overseas BTC strategy company?

There are two ways to invest in overseas listed companies: you can open an overseas brokerage account or trade through multiple brokerage trading. Taiwan brokerage firms often provide multiple brokerage trading for U.S. stocks, Japanese stocks, Hong Kong stocks, Shanghai-Hong Kong Stock Connect, etc. By opening one account, you can simultaneously invest in multiple national markets, providing a convenient investment channel for investors who do not need to buy and sell frequently.

)How to invest in overseas BTC reserve strategy companies? Is it better to open an overseas securities account or a discretionary account?(

This article is not investment advice, please DYOR.

This article Strategy leads the trend, a detailed explanation of BTC reserve strategy company investment guide first appeared in Chain News ABMedia.