While recent acquisition vehicles have successfully driven demand for Bitcoin, aggressive accumulation strategies can undermine the long-term institutional appeal of assets.
That's according to the latest one analysis From Swiss Digital Asset Bank Signum, released on Tuesday.
While these vehicles supported market demand, Sygnum warned that it could be improperly made 5% of the Bitcoin supply risk a strategy of undermining its status as a safe haven and as a reserve asset for central banks.
On Monday, the strategy was purchased Another 1,045 bitcoin, It is worth around $110 million, and its current total is 582,000 BTC, which is roughly 3% of the maximum Bitcoin supply that exists.
According to Raff, these purchases earned the highest ever profitable over 56% estimate From the Saylor Tracker.
This helped raise Bitcoin prices and profile, but Sygnum warns that concentration is approaching a dangerous level.
“Large, concentrated holdings are risk to any asset, Sygnum said in its report. “Tactical holdings are approaching the point of questionable.”
By portraying a large, leveraged approach as a “new norm,” the strategy can overshadow the cases that are valid for smaller, risk-adjusted Treasury allocations that Sygnum considers better suited to most companies.
Liquidity and market structure risks
The strategy model uses convertible debt to acquire more Bitcoin while leveraging stock prices in bull markets. analysis By Sherwood.
With each Bitcoin gathering, strategic stocks, MSTR, trades at premiums, allowing the company to raise capital and buy more Bitcoin, fueling the cycle of leverage and bullish sentiment.
However, the risks of these scenarios are clear.
Once Bitcoin enters a long-term slump and MSTR falls below the unpaid memo conversion price, the model could begin to curb the cracks and be forced to liquidate some of its Bitcoin holdings to cover its debt, Sygnum researchers explained.
“Permanent dividends reduce the risks of purchasing Bitcoin, which is funded by debt,” they noted.
However, if the strategy “choose to sell Bitcoin instead to avoid additional drugs on stock discounts,” the outcome could be “a very detrimental signal to the market.”
edit Sebastian Sinclair
