A well-known gold advocate denounced MicroStrategy’s investment plan to purchase more Bitcoin and build up its crypto reserve.

Peter Schiff, a vocal critic of the firstborn cryptocurrency, also slammed the pro-crypto stance of President-elect Donald Trump, arguing that it is detrimental to the country.

MicroStrategy’s Bitcoin Investment Strategy

MicroStrategy revealed that it has a $42 billion investment strategy to buy more Bitcoin in the next few years.

Analysts said that the American development company is known for purchasing a great deal of cryptocurrency regardless of market fluctuations.

Reports stated that MicroStrategy recently bought 55,500 BTC worth $5.4 billion, allowing the company to strengthen its position in the crypto sector.

As of press time, MicroStrategy owns 386,700 BTC worth over $36 billion, putting the firm among the biggest corporate holders of cryptocurrency.

A Dangerous Bet

Schiff criticized MicroStrategy’s continuous purchase of the digital asset, denouncing the $42 billion investment plan to acquire more Bitcoin within three years.

The Bitcoin critic described MicroStrategy’s BTC investment plan as “a dangerous bet.”

It’s now been four weeks since $MSTR announced its three-year plan to spend $42 billion buying #Bitcoin. MSTR has already spent $10 billion. At this rate, the three-year plan will be completed in about 16 weeks. Once the buying is done, expect both Bitcoin and MSTR to crash.

— Peter Schiff (@PeterSchiff) November 26, 2024

“At this rate, the three-year plan will be completed in about 16 weeks,” Schiff said.

He sees the price hike brought by what is called MicroStrategy’s “bold plan” will be short-term, leading to a considerable decline in BTC price and a drop in the company’s stock price.

Moreover, Schiff believes that the company’s large-scale purchase only brings an artificial price appreciation, noting that it may pose a problem to the firm because it put all its proverbial eggs in one basket which is not a smart concept in any investment.

BTC market cap currently at $1.88 trillion. Chart: TradingView.com

Schiff predicts that MicroStrategy might not be able to fund future purchases of Bitcoin, echoing his view that this move could possibly hurt both the company and its shareholders.

On the other hand, MicroStrategy executive Michael Saylor defended the company’s investment approach, saying that they have no plan of selling their crypto assets in the near future.

Image: ETMarkets.com

Saylor said that the company remains bullish on the future of BTC, urging other companies to draw inspiration from their investment strategy.

Historically, Schiff has been a staunch critic of MicroStrategy’s moves to buy Bitcoin.

Trump’s Pro-Crypto Stance: Detrimental To The Economy?

Schiff also criticized Trump in his plans to implement regulations that are pro-cryptocurrency, arguing that it will weaken the country’s economic standing.

“When the government picks winners and losers, it usually picks losers. Thanks to the Trump administration’s picking bitcoin, Wall Street is winning big by misallocating capital to BTC and related value-destroying businesses,” Schiff stated.

The staunch crypto critic believes that the US would become weaker once it became a Bitcoin superpower.

Meanwhile, crypto advocates dismissed Schiff’s opinions, saying that it is among the dumbest posts ever.

Featured image from FXLeaders, chart from TradingView

Volatility Shares, a financial firm known for its novel exchange-traded funds, is launching a new line of ETFs. The financial instrument, using a one-plus-one model, will give investors 100% leveraged exposure to two distinct assets simultaneously.

This novel product structure combines major asset classes like cryptocurrencies, equity indices, and volatility measures. It offers portfolios such as BTC+ETH, Nasdaq+ETH, S&P+BTC, S&P+ETH, S&P+Nasdaq, and S&P+VIX.

Volatility Shares Introduces Diversified Exposure to ETFs

According to Eric Balchunas, an ETF specialist at Bloomberg Intelligence, the one-plus-one ETFs are reminiscent of “Return-Stacked ETFs.” They use leverage to maximize exposure without requiring additional capital from investors. Balchunas highlighted the appeal of these products for investors seeking to optimize their portfolio allocation without sacrificing exposure to one asset for another.

“VolatilityShares launching a new line of One+One ETFs which use leverage to give you 100% exposure to two assets at once e.g. 100% QQQ + 100% Ether. Seems similar to the Return Stacked ETFs,” Balchunas remarked.

Jeffrey Ptak, CFA and Chief Ratings Officer at Morningstar, provided additional insight. He explained that the ETFs aim to deliver 100% notional exposure to each of the two underlying assets by utilizing futures contracts.

For instance, the Nasdaq+BTC ETF would simultaneously provide full exposure to the tech-heavy Nasdaq index and Bitcoin’s volatile crypto market. Ptak also confirmed that filings for this line of ETFs have been submitted to regulatory bodies.

Implications for Investors as Crypto-ETF Competition Heats Up

For investors, one-plus-one ETFs represent significant growth in the exchange-traded fund space. Combining traditional financial instruments like the S&P 500 or Nasdaq with high-growth assets such as Bitcoin and Ethereum can allow for unique diversification strategies.

However, the leverage inherent in these products introduces additional risks, particularly for volatile assets like cryptocurrencies. This could amplify both gains and losses.

“Products like these can be game changers for portfolio diversification, but their complexity and leverage make them suitable for informed investors who understand the risks,” said an industry expert following the announcement.

Nevertheless, Volatility Shares’ novel approach arrives amidst increased activity in the crypto ETF space. Bitwise recently filed with the US Securities and Exchange Commission (SEC) for a “Bitwise 10 Crypto Index ETF.”

The index seeks to track the performance of a diversified basket of top cryptocurrencies. The move reflects the growing demand for accessible crypto investments that go beyond single-asset offerings like Bitcoin or Ethereum.

Franklin Templeton also submitted a proposal to the SEC for a Bitcoin and Ethereum Index ETF. This fund would directly compete with Volatility Shares’ dual-asset products by targeting the same market of investors seeking to combine traditional equity exposure with cryptocurrencies.

Despite the surge in crypto-ETF filings, regulatory challenges remain a key hurdle. The SEC has been historically cautious in approving crypto-related ETFs due to concerns over market manipulation and volatility. However, with growing interest from institutional players like BlackRock, Franklin Templeton, and now Volatility Shares, the momentum toward approval may be shifting.

Marathon Digital Holdings (MARA), one of the largest publicly traded Bitcoin mining firms, has made significant strides in its cryptocurrency acquisition strategy. In a statement on November 27, the company revealed it had purchased 6,474 Bitcoin (BTC) during the month.

This brings the firm’s total holdings to 34,794 BTC, currently valued at approximately $3.3 billion based on a Bitcoin spot price of $95,000.

Marathon Digital Solidifies Position as a Leading Bitcoin Holder

The acquisitions were funded through Marathon’s recent $1 billion zero-interest convertible senior note offering. Reportedly, these netted up to $980 million in proceeds after transaction costs. The company used $200 million of these funds to repurchase a portion of its 2026 notes.

Marathon Digital said it earmarked $160 million in cash reserves for future Bitcoin purchases, particularly if the cryptocurrency’s price dips.

“…$160 million in remaining proceeds available net of transaction costs for future BTC dip purchases,” the firm said.

With its latest purchases, Marathon Digital has strengthened its standing as the second-largest corporate Bitcoin holder, trailing only MicroStrategy. While MicroStrategy dominates the space with 1.8% of Bitcoin’s total supply, Marathon’s holdings represent approximately 0.16%, a notable position in the growing trend of corporate Bitcoin adoption.

“Bitcoin is definitely something every company should have on its balance sheet,” Marathon CEO Fred Thiel said recently in an interview.

Thiel also emphasized Bitcoin’s scarcity and its utility as a hedge against inflation and fiat currency devaluation. Meanwhile, Marathon’s aggressive acquisitions reflect a broader trend among publicly traded companies.

According to Bitcoin Treasuries data, public firms increased their Bitcoin holdings from 272,774 BTC to 508,111 BTC year-to-date (YTD). November alone saw companies acquire over 143,800 BTC, a dramatic surge compared to the approximately 2,400 BTC purchased in October.

Strategic Moves Fueling Bitcoin Adoptions

MicroStrategy has led the charge, adding over 130,000 BTC in November, including a record-breaking single-week purchase. However, other companies are also joining the Bitcoin accumulation race.

For example, Rumble, the video-sharing platform, announced plans to allocate up to $20 million of its cash reserves to Bitcoin. The decision came after CEO Chris Pavlovski received encouragement from MicroStrategy’s Michael Saylor to adopt Bitcoin as a treasury asset.

Similarly, Genius Group, an AI-focused company, acquired $14 million worth of Bitcoin earlier this month. Committed to holding 90% of its reserves in Bitcoin, Genius Group aims to increase its Bitcoin investments to $120 million.

Marathon’s recent Bitcoin acquisitions and its financial maneuvers are part of a broader expansion strategy. The company’s $1 billion convertible notes offering is its second major funding initiative in 2024, following a $250 million fundraising effort reported in July. That earlier round was also aimed at bolstering its Bitcoin reserves and expanding mining operations.

As BeInCrypto reported, Marathon highlighted its commitment to scaling operations while maintaining a strong Bitcoin treasury strategy.

“With zero-interest funding secured, we are strategically positioned to capitalize on market opportunities and reinforce our role as a leader in Bitcoin mining,” the company noted.

Marathon’s aggressive approach to Bitcoin acquisitions and its financial planning have been well-received by the market. Its stock closed nearly 8% higher on Wednesday, with year-to-date gains of approximately 14%, data on Yahoo Finance shows.

Analysts attribute the stock’s performance to Marathon’s ability to leverage its financial resources for growth. They align with the broader market enthusiasm for Bitcoin. The cryptocurrency’s 2024 rally has sparked renewed interest among institutional and corporate investors, with Bitcoin recently surpassing $95,000 per coin.

Nevertheless, the company faces revenue challenges and strategic shifts amid crypto volatility. Specifically, among the challenges was meeting analysts’ third-quarter (Q3) earnings expectations. The Bitcoin miner reported a loss of $0.24 per share, slightly worse than the anticipated loss of $0.23 per share. This resulted in an earnings surprise of -4.35%.

In the face of these challenges, Marathon Digital Holdings has been diversifying its operations beyond traditional Bitcoin mining. Beyond miner activities, the firm also explores opportunities in artificial intelligence (AI) and other emerging technologies. These could help reduce its reliance on Bitcoin’s price volatility and position it for growth in high-tech sectors.