Did you buy Bitcoin this week with Strategy? Saylor predicts a $69 billion increase in Holdings.

Strategy Chairman Michael Saylor tweeted over the weekend, sharing a chart filled with orange dots that represent the buying situation since the first purchase in August 2020, and wrote, “The most important orange dot is always the next one,” hinting at a plan to increase the position and buy Bitcoin again.

Michael Saylor's Mysterious Prediction: The Next Orange Dot is Coming Soon

(Source: Saylor Tracker)

Saylor posted a tweet on social media on October 19, the core content of which has been his company's reflection on its Bitcoin purchasing situation, occasionally hinting at the answer to whether the Strategy bought Bitcoin this week. This time was no exception, as Michael Saylor once again released a chart filled with orange dots, representing the purchasing situation since the first purchase in August 2020.

However, more background information lies not in the chart itself, but in the title, as Saylor said: “The most important orange dot is always the next one.” This remark undoubtedly led followers of the cryptocurrency market to speculate whether Saylor and his team purchased Bitcoin last week, but to be honest, it would be strange if they didn't buy.

This kind of preview-style communication has become Saylor's hallmark. In the past, he has also hinted at similar news before officially announcing purchases. This strategy not only creates anticipation for the upcoming announcement but also provides psychological support for the market. When investors know that Strategy might be about to buy, they often position themselves in advance, which in turn drives prices up, creating a more favorable market environment for Strategy's actual purchases.

Historically, the Strategy typically accelerates buying during market downturns. Data from the past five years shows that most of the purchases by Strategy occurred during Bitcoin price corrections. This “buying the dip” strategy not only lowers the average cost but also provides critical buying support for the market, helping Bitcoin to recover faster after adjustments.

Black Friday may become a golden buying opportunity: $105,000 bottom-fishing chance

Last week, the price of Bitcoin fell, which was hardly predicted by anyone at the beginning of October. The asset broke below the key level of $105,000, almost all the way down to the notorious low set on October 10, a day known in the cryptocurrency world as “Black Friday.”

For Saylor and Strategy, buying Bitcoin there seems like a golden opportunity, as they have purchased at higher prices multiple times over the past few months. The answer to whether Strategy has bought Bitcoin this week is likely to be revealed within this price range. If Strategy really made a large purchase near $105,000, it will significantly lower their average position cost.

The opposite situation—choosing not to buy more BTC—is also understandable, as the severe damage caused to the market on that “Black Friday” has erased Strategy's $7 billion paper gains in just one week. This event undoubtedly affected the confidence of investors and strategists. When the paper losses reach such a scale, continuing to increase the position requires immense courage and conviction.

However, for steadfast Bitcoin believer Saylor, short-term paper losses have never changed his long-term strategy. He repeatedly emphasizes that Bitcoin is “digital gold” and “the ultimate weapon against inflation,” a belief that allows him to remain calm during market panic and even increase the position against the trend.

Strategy Holding 640,250 BTC: Accounts for 2.5% of total volume of the whale

The company's holdings of Bitcoin account for nearly 2.5% of the total Bitcoin supply, far exceeding any other publicly traded company. According to data from BitcoinTreasuries.net, Marathon Digital follows closely, holding only 53,250 Bitcoins, while XXI (CEP) and Japan's Metaplanet hold 43,514 and 30,823 Bitcoins, respectively. The top 15 companies together hold over 900,000 Bitcoins.

The 640,250 BTC position of Strategy is of significant importance in this week's discussion on whether Strategy has bought Bitcoin. This amount accounts for 3.05% of the total Bitcoin supply of 21 million coins (approximately 3.25% if calculated based on the roughly 19.7 million coins that have been mined). Such concentration means that any buying or selling decisions made by Strategy will have a significant impact on the market.

More importantly, the gap between Strategy and other holding companies is enormous. The second-ranked Marathon Digital holds only 53,250 coins, which is less than 8.3% of Strategy's holdings. This monopolistic position makes Strategy a bellwether for Bitcoin investment in the business world, and its buying decisions often trigger a follow-on effect from other companies.

Calculating at the current price, the position valued at approximately 69 billion USD makes Strategy one of the entities with the highest Bitcoin value globally. This scale has already surpassed the foreign exchange reserves of many countries. If Strategy buys Bitcoin this week, regardless of the size, it will further solidify its dominance in the corporate Bitcoin investment space.

DAT Model Dilemma: Warning of Net Worth Falling Below 1.0

However, as Saylor's latest remarks were released, the industry is facing a crisis. A report from 10x Research shows that many Bitcoin fund management companies have seen their net asset values plummet, with billions of dollars in paper gains evaporating. Analysts indicate that companies that once traded at a premium above their actual Bitcoin holdings have now seen their valuations fall below their reserve values.

For example, the market value to net asset ratio of Metaplanet recently fell below 1.0, which means that investors value the company lower than its holdings of Bitcoin. This phenomenon is known as “net asset value discount” (NAV discount) and is a major challenge faced by the Digital Asset Trust (DAT) model. In the context of this week's Strategy, have you bought Bitcoin yet? This issue is even more pronounced.

The logic of the DAT model is: the company raises funds by issuing stocks or bonds to purchase Bitcoin, and investors buying the company's stocks are essentially holding Bitcoin indirectly. Ideally, the company should enjoy a premium as it offers professional management, leveraged strategies, and the convenience of having Bitcoin exposure in a traditional securities account. However, when the market value falls below the net asset value, the attractiveness of this business model is called into question.

Despite the sluggish market, Saylor appears to be unfazed—he hinted that the next “orange dot” of Strategy may appear on the chart soon. This steadfast attitude is particularly important when the DAT model is facing scrutiny, as it conveys a signal of confidence to the market.