Author: Jack
Bitcoin is heading towards $100,000, but the crypto trading group is very quiet. After Trump's election, everyone was expecting a surge in liquidity, but apart from the meme hype activated by Binance, all Altcoins have been left far behind by BTC. Why? Why has Bitcoin been rising recently, while Altcoins have been falling, and Bitcoin falls, Altcoins still fall?
The answer may lie in the $MSTR stock.
MicroStrategy buying Bitcoin is not a new phenomenon in the crypto world, it has become a BTC index in the US stock market since the last cycle. However, in September this year, MSTR has once again attracted the market's attention. This time it is because MSTR actually started up before the rise in Bitcoin price, and maintained a persistent premium over Bitcoin in the subsequent market.
The Net Asset Value (NAV) premium and MicroStrategy's stock issuance activities are highly correlated, and the NAV premium will rise shortly after MSTR's issuance. According to MSTR Tracker, the current NAV premium is around 3.3.
So many people have started discussing "why MSTR has a premium". In fact, MicroStrategy has quietly started a new Bitcoin buying strategy since the middle and late last year, called "premium issuance".
In simple terms, MicroStrategy has previously been raising funds to buy BTC through debt issuance, which means that each MSTR share represents a certain amount of BTC (which is also why it is seen as a US stock BTC index). However, the "premium issuance" model is more straightforward and immediate: when the Bitcoin price rises and the company's market value increases, the exchange rate between MSTR and Bitcoin will generate a premium.
At this time, the company issues more MSTR shares to buy more Bitcoin at a premium, so that each MSTR share corresponds to more BTC, which also means that the company's market value and the value of MSTR will rise, and then the cycle will repeat, constantly spinning the flywheel.
In a nutshell: the more MSTR is issued, the more valuable it becomes.
What does this have to do with the Bitcoin bull market? Apart from the fact that MicroStrategy accounts for 5% of the total circulation, the US stock market seems to be experiencing a Paradigm shift. MicroStrategy CEO Michael Saylor has been emphasizing throughout this year: there will be more and more MSTR in the US stock market, and he calls his model an "infinite money glitch". At first, many people did not take it seriously, but recently when giants like Microsoft have also started exploring "Bitcoin treasury", you can feel the gears of fate starting to turn.
That is to say, if Saylor's vision continues to become a reality, more and more US companies will adopt the "premium issuance" Bitcoin treasury, and the Bitcoin price will be further tied to the US stock market. And these huge liquidity flows will be entirely borne by BTC as a single target, with no relation to other Altcoins (which is also one of the reasons why the inflow of Bitcoin ETFs has surged recently, while Ethereum ETFs have been flat).
It can be foreseen that if the crypto industry stops in its tracks in terms of narrative innovation and practical capabilities, Bitcoin will gradually drift away from Crypto. In this context, the bull market will only have two betas: one is Bitcoin, and the other is Solana, which can absorb the liquidity within the circle.
