Better Crypto Buy: Bitcoin vs. Strategy (MicroStrategy)

Core Viewpoint - Strategy (NASDAQ: MSTR) has shown remarkable long-term performance, with its stock increasing over 2,300% since it began accumulating Bitcoin in August 2020, but it has recently faced a nearly 20% decline since July 1, 2024, leading to investor uncertainty regarding whether to invest in Bitcoin or Strategy [1][2]. Performance Comparison - Over the past five years, Strategy has significantly outperformed Bitcoin, rising over 2,300% compared to Bitcoin's 900% increase. Since January 1, 2024, Strategy has surged 450%, while Bitcoin has only increased by 150% [3]. - The divergence in performance has led investors to view Strategy as a leveraged investment in Bitcoin, potentially offering higher returns than direct Bitcoin investments [4]. Market Dynamics - The price of Strategy is contingent on Bitcoin's price increase, and investors must be willing to assign a premium to Strategy's Bitcoin holdings for its stock price to rise [4]. - In November 2024, following a Bitcoin price surge post-presidential election, Strategy's stock reached a 52-week high of $543, with investors attaching a premium of over 300% to its Bitcoin holdings [5]. - Currently, Strategy's stock has fallen to $335, and the premium on its Bitcoin holdings has decreased to 126%, indicating potential risks for investors in Bitcoin treasury companies [6][7].