Fidelity, Bank of America’s Indirect Exposure to Bitcoin Through MicroStrategy

Bank of America and Fidelity held significant numbers of MicroStrategy shares on their balance sheets through the first quarter, suggesting continued institutional interest in indirect bitcoin exposures.

Bitcoin volatility has tapered off in recent weeks as crypto traders weigh the asset’s substantial bounceback in 2023 from last year’s lows.

Through the end of March, Bank of America was showing 86,147 MicroStrategy (MSTR) shares purchased over the course of the first quarter. Fidelity, according to an SEC filing, snapped up 97,199 shares over the same period.

Both filings track trades from January 1 through March 31 and are not necessarily indicative of overall holdings for either company.

Shares of MicroStrategy (MSTR) have closely tracked the price of Bitcoin since the company began holding the digital currency as a reserve on its balance sheet. And scores of traders still view the stock as one of the closest publicly traded proxies for spot bitcoin exposures.

BTC vs MSTR 2 year / Yahoo Finance

Youwei Yang, chief economist at Bit Mining, told Blockworks in an interview that MicroStrategy continues to be known as the “top choice” for obtaining indirect bitcoin exposure via public and regulated markets.

Plus, bitcoin has been on the upswing for the last three to four months, Yang said, making it a no-brainer for traders to hop on MicroStrategy shares and other bitcoin exposed assets.

“Starting [in] early January, the coins have been climbing quite a bit and it’s [natural] for a trader, whether small or large, to jump in to [buy] any exposure related to crypto or bitcoin,” Yang said.

The SEC disclosures come as MicroStrategy has continued its long time corporate strategy of adding more and more bitcoin to its portfolio. Founder Michael Saylor’s business intelligence company owned 140,000 bitcoins (BTC) through April 4.

MicroStrategy has maintained its accumulation even as crypto markets have been rattled by escalating US enforcement actions by the SEC and the CFTC. Saylor last year stepped down from his chief executive seat and has since been accused of tax evasion.

The US publicly traded company hasn’t been deterred — despite posting a net loss of $250 million in the fourth quarter on its BTC holdings.

On a fourth quarter earnings call in February, MicroStrategy Chief Financial Officer Andrew Kang said that “our corporate strategy and conviction in acquiring, holding and growing our bitcoin position for the long term remains unchanged.”

Industry participants, including crypto hedge funds and family offices, have been eyeing MicroStrategy’s latest market moves as traders parse unsteady macro conditions.

MicroStrategy or $MSTR is the only public company in the world has successfully accumulated 140,000 #bitcoin in less than three years.

Congrats @saylor! Your conviction will pay well in the future.

— Louis (@louishliu) April 5, 2023

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