As more companies pivot into crypto, who's buying bitcoin?
Public companies — especially Strategy (MSTR) — now hold over 3% of the bitcoin (BTC-USD) in circulation, according to Bernstein data.
Yahoo Finance senior reporter David Hollerith sits down with the Market Domination Overtime team to speak more on the latest crypto-buying trends from major companies.
To watch more expert insights and analysis on the latest market action, check out more Market Domination Overtime here.
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Yahoo
14 minutes ago
- Yahoo
Jim Chanos Sees Big Short in Saylor's Strategy, But Others Aren't So Sure
(Bloomberg) -- Buy Bitcoin, short Michael Saylor's Strategy. That's the latest call from legendary short-seller Jim Chanos, who sees the arbitrage play as a no-brainer. Others aren't so sure. ICE Moves to DNA-Test Families Targeted for Deportation with New Contract Next Stop: Rancho Cucamonga! The Global Struggle to Build Safer Cars US Housing Agency Vulnerable to Fraud After DOGE Cuts, Documents Warn NYC Residents Want Safer Streets, Cheaper Housing, Survey Says The trade has long been on the radar of Wall Street hedge funds, drawn to the premium Strategy's shares enjoy relative to the value of the company's Bitcoin holdings — a gap that topped 200% last year. The discrepancy stems from Saylor's self-styled Bitcoin treasury strategy, through which he has tapped capital markets to buy more and more of the world's biggest cryptocurrency, in turn attracting billions of dollars from retail investors. In the eyes of many arbitrage specialists, the yawning spread is unsustainable — in fact, it's already begun to narrow, but they see further opportunity to profit. 'I haven't seen an arbitrage like this in this size in years, years and years,' Chanos said during a recent interview on the Risk and Return podcast, referencing the trade he disclosed on CNBC in early May. It's one of a series of sophisticated trading strategies around the complex capital structure of Saylor's firm, formerly known as MicroStrategy, and the growing ecosystem of crypto investment vehicles. Some market players see parallels to the once-popular 'widow-maker' pair trade involving Bitcoin and the Grayscale Bitcoin Trust, but with fewer constraints. There are still risks involved, though. Chanos, known for his prescient bet against Enron Corp. 20 years ago, emphasized that his current favored trade isn't a wager against Bitcoin or Strategy, but rather a mirror of Saylor's own playbook: selling equity and raising capital to buy more digital assets. The core opportunity, he said, lies in the divergence between Strategy's market price and the company's Bitcoin-adjusted book value. 'The fact of the matter is, this is a Bitcoin holding company,' Chanos said on the podcast explaining the premium dislocation. Buying Strategy shares at their current price of around $400, he said, is effectively equivalent to buying Bitcoin at about two times its value — 'paying around $220,000 for Bitcoin that trades at $110,000. But the company is doing everything it can to close that spread, which is great — there's a catalyst.' A growing number of copycats have also started pursuing similar crypto-treasury strategies, further shifting supply-demand dynamics, Chanos added on the podcast. The investor didn't respond to a request for comment, nor did representatives for Strategy. On a basic level, the premium as measured by Strategy's market capitalization relative to its Bitcoin holding value stands at 70%, according to Bloomberg calculations. Taken a step further — adding in other dilutive securities the company has employed in its massive capital raising in the last year and removing the value of Strategy's legacy software business — and investors are paying a premium for the stock that's nearly double the value of the firm's Bitcoin holdings. If Bitcoin rises but Strategy's premium compresses — or if share dilution outpaces gains— Chanos' trade would turn a profit. Yet like any arbitrage, the spread may widen before it narrows, as seen in the GBTC trade around 2021. Premium Warranted? Some analysts and retail believers argue that a substantial premium in Saylor's firm is warranted, placing it in a unique category. First of all, Strategy offers investors exposure to a zero-fee Bitcoin vehicle, offering an edge over comparable exchange-traded funds. What's more, the company demonstrated an ability to use leverage to grow Bitcoin per share over time, an added value for investors buying the stock instead of the ETFs or underlying crypto, according to TD Cowen analyst Lance Vitanza, who believes Strategy's Bitcoin per share will increase by 26% this year. 'I expect MSTR will trade around its recent historical premium, either side of 100%, for the foreseeable future,' he said, referring to Strategy's ticker. Timing — when to enter and exit the wager— remains a key variable around returns, given the spread's ongoing volatility. In March 2024, Kerrisdale Capital Management promoted a similar pair trade in a letter titled 'Know When to HODL, Know When to FODL,' in a nod to crypto lingo. The firm still stands by its thesis, but 'I don't have the trade on now,' said founder Sahm Adrangi. 'When we put out the report, the premium was much higher and it made sense at that point. Is it going to zero? I don't really know,' he said, declining to specify when the firm closed the position. To Chanos and other fans of the trade, Strategy's ample market capitalization — now over $100 billion — and deep float make it relatively easy to maintain the short leg. For hedge funds, new borrows are being priced at a fee of 0.3 percentage point, according to data from S3 Partners. This helps to keep the cost of carry manageable while waiting for the spread to narrow. The inexpensive terms are likely to persist, given the stock's roughly 250 million free floating shares, and that only 11% is currently sold short, said Sam Pierson, director of research at the firm. But that doesn't eliminate the risk that the borrowing dynamics could change — potentially becoming more expensive and less stable, especially for individual investors, said Victor Haghani, chief investment officer of Elm Wealth and founding partner of Long Term Capital Management. There's a lot of demand for borrowing shares related to convertible arbitrage wagers and leveraged short ETFs, he added. Another source of uncertainty is the potential for an unexpected corporate event, such as a merger that might shift the company's fundamental business, complicating premium estimates and muddying the existing trade. 'Say if all of a sudden Strategy is part of something that is twice as big — then when you try to look at the valuation relative to the Bitcoin it holds, you can't really say that much anymore because now there's a business with revenues,' Haghani said. Still, he is confident of the spread's long-term convergence. 'My expectation is that in four or five years at the longest, the premium will be zero or even negative,'he said. 'I think this is a good trade, a good one possibly for hedge funds, but it's not one I'd want to put on in my personal account for the risks involved and my disadvantaged position relative to hedge funds in running the trade.' --With assistance from Tom Contiliano. Cavs Owner Dan Gilbert Wants to Donate His Billions—and Walk Again YouTube Is Swallowing TV Whole, and It's Coming for the Sitcom Millions of Americans Are Obsessed With This Japanese Barbecue Sauce Is Elon Musk's Political Capital Spent? Trump Considers Deporting Migrants to Rwanda After the UK Decides Not To ©2025 Bloomberg L.P.
Yahoo
26 minutes ago
- Yahoo
Investing $15,000 Into Each of These 3 Stocks 5 Years Ago Would Have Created a Portfolio Worth $1 Million Today
Strategy, Mara Holdings, and Verona Pharma have each risen by more than 1,500% in the past five years. Investments in speculative cryptocurrency plays like Strategy and Mara Holdings can pay off. They can also go quite badly. Verona Pharma is a less speculative investment now that it has its first approved treatment on the market. 10 stocks we like better than Strategy › If you want to achieve significant gains in the stock market, you'll probably want to plan to hold on and remain invested for many years, or even decades. But in some cases, big payoffs can come much faster than that. The benefit of investing in growth stocks is that they have the potential to deliver some terrific returns. For example, growth stocks Strategy (NASDAQ: MSTR), Mara Holdings (NASDAQ: MARA), and Verona Pharma (NASDAQ: VRNA) have yielded fantastic gains for investors over the past five years. If you had invested $15,000 into each one of these stocks just five years ago and held on, you would have a portfolio worth more than $1 million today. The question is, do they still have the potential for further significant gains for investors who buy them right now? A $15,000 investment made five years ago into the company that at that time called itself MicroStrategy would now be worth around $458,000. That's a staggering return when you consider that its core technology business hasn't been taking off. The company, which earlier this year shortened its name to Strategy, has actually experienced a decline in revenue in recent years. While it's nominally involved in providing business intelligence solutions, the reason its stock skyrocketed was tied to its aggressive moves in the cryptocurrency space. Strategy is the largest corporate holder of Bitcoin (CRYPTO: BTC), with a stash that now totals more than 500,000 coins. The company routinely updates investors on its position and Bitcoin holdings. Executive Chairman Michael Saylor is incredibly bullish on the popular digital currency's potential value, predicting that its token price will climb to well over $1 million in the future, and suggesting that it could potentially top $13 million by 2045. Strategy stock could still rise higher if Bitcoin does well. But it's a highly speculative buy: Its valuation is not tied to its overall performance, but is instead contingent on how strong the crypto market is. If you're bullish about that, you may feel that the stock could be a good buy. But for the majority of investors, this investment is likely to be too risky and speculative to hold. Bitcoin mining company Mara has also benefited from the cryptocurrency's rising value over the past five years. During that stretch, a $15,000 investment into the stock would have grown into a holding worth approximately $290,000. Remarkably, that result includes a steep drop that it hasn't fully recovered from yet: The crypto stock is down by more than 50% from where it began 2022. In the past three years, the company's bottom line has fluctuated drastically, from a loss of more than $694 million in 2022 to a profit of $541 million in 2024, and the stock has been similarly volatile. Its performance inevitably hinges on the changes in the market value of the digital assets it mines and holds. As with Strategy, this is a speculative buy, as Mara's valuation will ultimately depend on how well Bitcoin is doing. This isn't a stock I'd suggest owning unless you have an extremely high risk tolerance. The only stock on this list that hasn't amassed its gains due to crypto is Verona Pharma. However, the biopharmaceutical company has still generated impressive returns for investors. A $15,000 investment in the business five years ago would now be worth $267,000. Add that to the gains from your hypothetical $15,000 investments in the other two companies mentioned, and you'd have around $1.02 million. Shares of Verona started to take off in June 2024 after the company obtained Food and Drug Administration approval for Ohtuvayre as a maintenance treatment for chronic obstructive pulmonary disease. Analysts believe Ohtuvayre can become a blockbuster drug, generating more than $1 billion in annual revenue for Verona by 2029. Verona incurred a loss of more than $173 million last year, but with Ohtuvayre already beginning to generate sales, the business is on a much more positive trajectory. The stock's valuation isn't cheap, as its market cap is hovering around $7 billion. But given its promising growth prospects and its possible path to profitability, it's the only stock on this list that I'd consider buying today. Before you buy stock in Strategy, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Strategy wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $668,538!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $869,841!* Now, it's worth noting Stock Advisor's total average return is 789% — a market-crushing outperformance compared to 172% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 2, 2025 David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy. Investing $15,000 Into Each of These 3 Stocks 5 Years Ago Would Have Created a Portfolio Worth $1 Million Today was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNBC
35 minutes ago
- CNBC
Couple lives on $132,000 in the 'Hamptons of New Zealand'—it's expensive, but 'worth it' for the relaxed lifestyle
When Phoebe Merrick first arrived on Waiheke Island in New Zealand, she thought she'd only be there for two months. It was June 2023, just before Merrick's final year of college, and the Virginia native planned to work a summer internship at a winery on the island. "I was like, 'This cannot be real,'" Merrick tells CNBC Make It of the view while ferrying over from Auckland. "I just thought it was so beautiful." Two years later, Merrick is still on Waiheke and getting ready to move into a new house with her boyfriend, Reuben Sandoy, who grew up in the area. The two met during Merrick's summer program and, by autumn, Sandoy had traveled to meet her family in the U.S. and the two decided they would live together abroad. Merrick, 22, works remotely as a freelance marketing and social media manager while Sandoy, 29, runs his own plumbing business on the island. Together, the two make roughly $132,000 U.S. dollars per year. Here's how they live and spend their money on Waiheke. Waiheke Island is the second-largest island in the Hauraki Gulf of New Zealand and is a roughly 40-minute ferry ride from Auckland. The area is known for its wineries and beaches. Roughly 9,000 people live on the island during the winter, and the population swells to upwards of 45,000 each summer. More than 900,000 people visit the popular tourist destination each year, and it's sometimes referred to as the "Hamptons of New Zealand," where the rich and famous vacation. But ultimately, what drew Merrick to Waiheke is the reason why Sandoy has lived there the majority of his life: the beautiful scenery and slow pace of living. As a local, Sandoy appreciates that everything is close and there's little traffic. He also has little competition as a plumber to earn business on the island. Adjusting to life far from home took Merrick some time. There were differences in routine, like driving on the other side of the road and living without the conveniences of Amazon delivery. It also came with a level of culture shock around money and the price of living far from a big city. "I felt like a millionaire when I first came over," Merrick says, noting that paying with the strong American dollar versus the New Zealand dollar made her savings go farther. As of May, $1 USD is worth about $1.70 NZD. Her earnings don't go as far in local currency, but "it's worth it for the lifestyle for me. I love living on an island," Merrick says. Here's how Merrick and Sandoy spent their money in April 2025. Living on an island like Waiheke is expensive. The couple has been living in Sandoy's mother's house rent-free for several years. What they saved on rent they've funneled away for a down payment, mortgage payments and future renovation costs for a new house. After their savings, the couple's second-highest spending category was for food. Food costs are high because a lot of things have to be imported; going out to eat also comes at a premium when many restaurants cater to wealthier tastes and higher budgets. "You'll go to restaurants, and it won't be like just a casual pizza or burger — it'll be a truffle ravioli or caviar on crayfish and all of that," Merrick says. The two enjoy food and are willing to spend on it — Merrick likes to host dinner parties and cook most meals, especially if she can recreate American recipes she misses, while Sandoy enjoys little luxuries like a steak dinner. "It's probably what we enjoy spending the most money on versus anything like shopping or going into the city," Merrick says. The couple's third-largest budget item for the month was on transportation — Sandoy drives around the island for work and spent about $800 NZD, or about $470 USD, on gas. Merrick prefers to take the bus around the island; the two will also visit Auckland via ferry and use rideshares to get around for the day. New Zealand has a free health insurance program, but Sandoy pays an additional $100 NZD, or about $58 USD, per month for premium coverage. Merrick is on her parents' health insurance and schedules doctors appointments for when she visits home in Virginia. Sandoy says he's been preparing to buy his own home with Merrick since they began dating, but the housing market has been tough to navigate. Real estate prices jumped in 2021 and remain elevated compared with pre-pandemic trends. In late May, Sandoy closed on a house worth $1.055 million NZD, or nearly $621,000 USD, handing over a 10% down payment. While the price is "pretty average," Sandoy says, he says he was able to afford it because it's a fixer upper in need of renovations. Sandoy and Merrick have both been saving for future mortgage payments and renovation costs. They moved in right away and will live there while renovating the three-bedroom, two-bathroom home over the next year. "We're both very excited to renovate together," Merrick says. "It is something that we both find quite fun. It's a great financial step to take as a couple, so it will be worth it in the long run, even if it is a bit scary right now." Sandoy works up to 50 hours per week doing repairs and home projects for clients on the island; he makes around $153,000 NZD, or roughly $91,000 USD per year. It's labor-intensive work involving "crawling underneath houses or working out in the elements." Sandoy says his job can be demanding because he's self-employed. Merrick works about 40 hours per week doing social media and marketing for four local clients she found via a Facebook message board. She makes $70,000 NZD, or roughly $41,000 USD, per year. As her own boss, Merrick says she's able to make a little bit more than what other entry-level marketing roles typically pay in New Zealand. Merrick never had a full-time job in the U.S. but says "moving to New Zealand definitely changed my perspective on work-life balance." Workers are generally entitled to four weeks of paid leave each year on top of about a dozen public holidays. Merrick says many of her friends from college work over 40 hours per week, and some have as few as three vacation days per year. Merrick says that her contract jobs are flexible and her supervisors value taking breaks. "All my bosses are very understanding and definitely believe in taking time off as well, [including] for mental health," Merrick says. "I definitely do feel a lot happier just because my lifestyle is different," she adds. "Back in the U.S., everyone was too busy to spend time with each other [due to] work." On Waiheke, meanwhile, "people have a lot more free time, and we're able to all spend time together, and it feels a lot more social," Merrick says, whether it's going to the beach or traveling around the island and greater New Zealand together.
