Capital Group’s strategic foray into the Bitcoin market has proven exceptionally lucrative, with reports indicating that its Bitcoin-related stock has surged over 400%. The American asset management firm’s Bitcoin holdings have escalated from $1 billion to an impressive $6 billion, largely driven by the efforts of veteran portfolio manager Mark Casey.
Casey, who has been instrumental in Capital Group’s investments over his 25-year career, acknowledged that his approach to Bitcoin investment has been deeply influenced by notable figures like Benjamin Graham and Warren Buffett. In a recent podcast with venture firm Andreessen Horowitz, he referred to Bitcoin as “the coolest invention in history,” expressing his enthusiasm for the original cryptocurrency.
The firm’s involvement in the crypto space began in 2021 when it made a significant investment of over $500 million in Strategy (formerly MicroStrategy), acquiring a 12.3% stake. Despite a dilution of that stake to 7.89% due to new share issuances, the investment has seen remarkable growth, with Strategy’s stock soaring more than 2,200% over the past five years, thereby valuing Capital Group’s stake at around $6.2 billion.
Casey noted that when assessing Bitcoin-focused companies, his team applies the same investment methodologies they would use for commodities like gold or oil.
In addition to its holdings in Strategy, Capital Group also owns a 5% stake in Metaplanet, a corporate Bitcoin firm listed in Tokyo, and has investments in Mara Holdings, further diversifying its exposure to the burgeoning cryptocurrency market.
The growing interest from institutional investors is reflected in broader market statistics, which show that corporate Bitcoin holdings have surpassed $117 billion, with Strategy leading the pack at 638,460 BTC valued at approximately $73.57 billion. Other significant players in the corporate Bitcoin space include Mara Holdings, with 52,477 BTC valued around $6.05 billion, and XXI (CEP), holding 43,514 BTC, worth about $5.01 billion. In total, corporate entities are reported to hold approximately 1.01 million BTC.
As of now, Bitcoin prices are hovering just above the $115,000 mark, with optimistic projections suggesting a strong finish to the year. These developments highlight the escalating institutional interest in cryptocurrencies, with firms increasingly viewing Bitcoin as a valuable asset class for diversifying their investment portfolios.
