Four companies buy bitcoin on leverage as NASDAQ lists options
November has marked the arrival of a new class of bitcoin investor. Just as the progressive introductions of custodial exchanges, publicly-listed trusts, futures, and spot ETFs ushered in new types of capital allocators, this month is a peak for a different type of bitcoin product: corporate leverage.
This week alone, four public companies have added billions of dollars in collective debt to their balance sheets in order to buy bitcoin: MicroStrategy, Marathon Holdings, Semler Scientific, and MetaPlanet.
In addition, Blackrock suddenly announced the listing of options — yet another form of leverage — atop its flagship spot bitcoin ETF, IBIT.
The introduction of options on Blackrock’s institutional, marginable, price-tracking ETF will allow sophisticated market participants access to powerful hedging strategies. IBIT options are scheduled to commence trading on NASDAQ today.
For context, bitcoin has rallied 32% since the start of the month, and corporate leverage is only a part of that mix.
MicroStrategy’s $42 billion and Donald Trump ignite November rally
Initially fueled by MicroStrategy’s noteworthy $42 billion capital allocation plan — doubling the company’s market capitalization as of the time of the announcement — it rocketed even higher on the evening of November 5.
The re-election of Donald Trump, who made various pro-crypto promises for his upcoming term, earned cheers from millions of bitcoin investors and an 8% rally within 24 hours.
Read more: All bitcoin models destroyed: Stock-to-Flow, Power Law, Rainbow
Both MicroStrategy CEO Michael Saylor and President-elect Donald Trump have made good on their considerable promises for the past two weeks. Saylor closed billions of dollars of his convertible debt round to buy tens of thousands of bitcoin, and Trump has announced various pro-bitcoin appointments to his administration.
This week, at least four public companies are actively tapping corporate debt markets to leverage their own balance sheets for bitcoin exposure. This also allows bond traders — yet another class of investor — to gain exposure to bitcoin’s price via convertible, option-enhanced, or warrant-covered commercial paper.
With Blackrock’s listing of IBIT options as an additional hedging option on the NASDAQ this week, a new era of leveraged bitcoin trading fueled by corporate debt has begun.
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