Why are Norwegian and Swiss banks buying MicroStrategy shares?
Central banks in Europe have acquired shares of pro-Bitcoin software firm MicroStrategy, potentially making an indirect bet on the trendy cryptocurrency.
The Norwegian and Swiss central banks bought 1.1 million and 466,000 MicroStrategy shares, respectively, according to MSTR shareholder data provided by the Nasdaq’s official website.
Why apex banks from two of the largest European economies by gross domestic product invested in MicroStrategy is unknown, but two reasons stand out.
Are banks betting on Bitcoin through MSTR?
One working theory suggests that sovereign financial institutions are bullish on Bitcoin (BTC). MicroStrategy is the largest corporate BTC holder in the U.S., with crypto holdings exceeding $13 billion in value.
The Tysons Corner-based company began buying Bitcoin in 2020 under the direction of executive chairman and former CEO Michael Saylor. After initial skepticism toward the blockchain currency, Saylor pitched Bitcoin as a store of value, an inflation hedge, and a superior digital asset.
Given that MicroStrategy is a major Bitcoin buyer, it’s possible that the Norwegian and Swiss central banks sought BTC exposure through MSTR.
This wouldn’t be the first time financial institutions have seemingly made such a play. In July 2023, banks like Goldman Sachs and wealth managers like BlackRock and Fidelity invested millions of dollars in MSTR shares. At the time, Saylor was doubling down on pro-Bitcoin rhetoric and increasingly acting as a corporate BTC evangelist.
Nothingburger
A divergent view suggests that the two apex banks merely view MicroStrategy as a good investment. On X, Patrick Saner, head of macro strategy at Swiss Re, said that nothing indicated a Bitcoin bullish outlook from Norges Bank and the Swiss National Bank.
Nevertheless, speculators may see the development as positive for MicroStrategy and Bitcoin adoption. Global BTC adoption has accelerated in the last four years, with El Salvador legalizing BTC and Wall Street spot BTC exchange-traded funds amassing over $50 billion in assets under management in less than a year.
Talks of a strategic Bitcoin reserve have also surfaced during U.S. presidential campaigns. Former president Donald Trump is the most prominent White House aspirant pushing for Bitcoin-friendly policies in America. Under the current administration, crypto voices have argued that the industry has suffered from a lack of clear rules and faced several unfair litigations as a result.
Hope exists that the current Dem ticket, with vice president Kamala Harris and Minnesota governor Tim Walz, may repair relations with the digital industry. Harris had yet to declare her stance on cryptocurrencies despite the election being held less than three months away.
Despite doubts over Harris’ crypto policy plan and the crypto community’s support for Trump, industry veterans like Coinbase CLO Paul Grewal have emphasized that crypto must remain a non-partisan matter.
