MSTR too crazy? There's an even crazier Hong Kong version of MSTR!
Today, Bitcoin ended its recent decline, rising over $6,000 to a peak of $97,000. In the recent "Bitcoin frenzy," two Bitcoin-related stocks may become the biggest winners of the year. They are MicroStrategy (MSTR) in the United States and Boyaa Interactive ($ BOYAA.HK) in Hong Kong.
MSTR has increased about sevenfold since the beginning of the year, while Boyaa Interactive has surged about tenfold!
In terms of operational form, both Boyaa Interactive and MSTR stand out among many Bitcoin-related stocks by adopting the simplest and most straightforward approach—directly purchasing and holding large amounts of Bitcoin to attract a significant number of investors. Unlike other concept stocks (cryptocurrency exchanges, mining machine manufacturers, computing power mining), these two companies had little to no connection with Bitcoin in their original main businesses. MSTR was originally a provider of business intelligence (BI) and analytics software, while Boyaa Interactive primarily engaged in the development and operation of online board games.
Since the beginning of this year, MSTR has repeatedly made significant purchases of Bitcoin.
From August 6 to September 12, over the course of more than a month, the company invested approximately $1.11 billion to purchase a total of 18,300 Bitcoins. As of September 13, its Bitcoin holdings amounted to approximately 244,800 coins.
On October 30, MSTR announced a "21/21 plan," which aims to raise $42 billion through $21 billion in equity and $21 billion in bonds over the next three years to purchase more Bitcoin.
On November 10, MSTR purchased another 27,200 Bitcoins for approximately $2.03 billion, with an average purchase price of $74,500 per coin, marking the largest buy order since December 2020.
As of November 17, the number of Bitcoins held by MSTR increased to 331,200, with a total acquisition cost of $16.5 billion. Based on the Bitcoin price of $95,500 per coin on November 28, the total value of MSTR's holdings was $31.628 billion, with an unrealized gain of over $15.5 billion. As of November 28, the latest stock price was $388.84 per share, having risen about sevenfold since the beginning of the year.
Boyaa Interactive began purchasing Bitcoin in 2023. In August 2023, the company announced that it would use cash reserves to purchase Bitcoin and Ethereum, with a budget of $5 million Since then, Boyaa Interactive has repeatedly announced increases in its budget for purchasing cryptocurrencies. According to the third-quarter performance report released by Boyaa Interactive on November 21, by the end of 2023, it held only 5 bitcoins, but by the end of March this year, its holdings had increased to 1,194 bitcoins. As of the end of the third quarter of this year, Boyaa Interactive's holdings further grew to 2,635 bitcoins.
As of November 21, Boyaa Interactive held 2,688 bitcoins, with an average cost of $54,400 per bitcoin. Based on the bitcoin price on that day, Boyaa Interactive's unrealized gains exceeded $117 million. As of November 28, the latest stock price of Boyaa Interactive was HKD 4.92 per share, which has increased about tenfold since the beginning of the year.
However, in terms of aggressiveness, MSTR's approach is far more extreme than that of other "holding stock" concept companies. The owner of MSTR is a capital operation expert who uses all of the company's funds to leverage bitcoin purchases, effectively turning the company into a corporate bitcoin leveraged ETF, with its stock price increasing 40 times over two years, reaching a peak market value of over $100 billion. However, it is worth noting that currently, MSTR's market value is much higher than the value of its held bitcoins, indicating a significant premium in the market's valuation of the company. Investors should fully consider these factors and carefully assess risks when making investment decisions. In contrast, Boyaa Interactive's premium and leverage ratio have not reached the levels of MSTR, which may be an important factor in attracting a portion of currently more cautious investors
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