Bitcoin has come a long way from being received with skepticism to attracting the attention of some of the most prominent investors in the financial markets. As of 2025, public companies like Tesla, Strategy (MicroStrategy), Metaplanet, BlackRock, and Fidelity have adopted Bitcoin as a treasury asset to hedge against inflation and diversify their reserves. The increased attention that institutional investors are giving Bitcoin reflects a bigger trend towards digital assets as stores of value and liquidity management.
Bitcoin’s Journey From ‘Crazy’ to National Reserve Fund
When Satoshi Nakamoto released Bitcoin’s white paper and launched the world’s first digital currency, most mainstream economists and policymakers dismissed it as a fringe “crazy” idea. However, Bitcoin is being actively discussed and adopted at governmental and institutional levels. The initial criticisms are now replaced by more trust and newer challenges.
Yet, many retail investors buy Bitcoin via a trusted crypto trading platform, tracking the investment style of larger market movers. Over the past decade, Bitcoin has steadily gained legitimacy through its decentralized architecture, fixed supply, anti-inflation capacity, and characteristic volatility.
Bitcoin is leading the crypto market’s disruption of traditional finance, becoming increasingly valued as a cross-border payment tool. Bitcoin is also seeing more recommendations for portfolio allocations and transforming how major financial institutions and asset managers invest.
Why Corporations Are Adopting Bitcoin
Over the last five years, Strategy and Tesla have purchased billions worth of Bitcoin, and the United States is set to create a Strategic Bitcoin Reserve. Here is why corporations are buying Bitcoin.
Hedge Against Inflation and Scarcity
There will only ever be 21 million Bitcoins, and as of April 2025, 19.86 million (94.57%) are in circulation. This positions Bitcoin as a hedge against fiat currency devaluation. Bitcoin’s scarcity-driven design makes it an asset with the potential to appreciate continuously.
Strategy and other institutional investors consider Bitcoin “digital gold,” a store of value protecting against macroeconomic instability and expansive monetary policies.
Tesla has a similar view. In 2021, Tesla invested $2.1 billion in Bitcoin to capitalize on its scarcity-driven model. This came after the EV giant announced that it would start accepting Bitcoin for payment.
Portfolio Diversification
After long periods of extensive debates, many financial regulators now recognize Bitcoin as an asset class, bringing the coin closer to wider market acceptance. For now, Bitcoin’s low correlation with traditional treasury assets like cash and bonds offers holders a better way to diversify their portfolio.
Unlike Bitcoin, traditional treasury assets face diminishing returns in low-interest-rate environments, making them less valuable than Bitcoin on some levels. This is why Strategy has purchased Bitcoin regularly, holding 423,650 Bitcoin, representing over 2% of the total supply.
Corporations are reallocating treasury reserves to Bitcoin to enhance their long-term value and leverage Bitcoin’s growth to unlock more liquidity.
Accounting Rules for Financial Reports
The Financial Accounting Standards Board (FASB) issued ASU 2023-08 on December 13, 2023, to address the accounting and disclosure of crypto assets. The reform enables corporations that hold Bitcoin to reflect unrealized gains on their balance sheets.
Since institutional Bitcoin holders can now report crypto at fair market value, Bitcoin has become a dynamic treasury tool for companies. This highly benefits them, as they can now avoid impairment charges and improve their balance sheets.
Enhanced Liquidity and Strategic Financing
Bitcoin’s capacity as a collateral asset, capital-raising tool, and balance sheet stabilizer benefits corporations that want enhanced liquidity and strategic financing.
Corporations can use Bitcoin as collateral for low-interest loans or issue convertible bonds. For example, Strategy has a new $21 billion at-the-market common stock equity offering, which will be used to purchase Bitcoin without liquidating assets. That way, companies can gain exposure to assets with potential price appreciation while meeting liquidity needs.
Corporations also have access to Bitcoin’s growing liquidity pools on regulated exchanges offering institutional custody solutions. This leads to improved slippage and increases Bitcoin’s reserve asset value. Bitcoin ETFs and derivatives also provide corporations with a way to track Bitcoin price without direct ownership, improving treasury allocation management.
Potential for High Returns
Bitcoin has consistently returned at least double-digit percentages in the last ten years, only closing on a loss in 2018 and 2022. 2017 saw the highest return in that period, with 1369.03%. The asset is up 10% in 2025 and 210,608,410.81% from its lowest price in 2010.
Bitcoin’s highly volatile nature makes it possible to gain a strong performance with an overall positive trend over the years. Corporations are also looking at this advantage to improve their financial returns. Companies holding Bitcoin by 2025 could see as much as 50% returns if Bitcoin reaches above $200,oo0 as several analysts predict.
Should Small Businesses Hold Bitcoin?
The decision to purchase, trade, or hold Bitcoin requires a clear policy framework for asset allocation, risk management, and reporting. If companies of all sizes decide to hold Bitcoin, they must provide a clear strategy to guide their investment. Strategy purchases Bitcoin regularly, taking advantage of significant price corrections to stack more.
Small businesses that can afford it should consider holding Bitcoin to diversify their portfolio, maintain resilience against fiat inflation, and gain a stake in future financial transactions.
With more traditional financial institutions embracing Bitcoin and offering access to retail and institutional clients, adopters are still early for major Bitcoin moves.
What’s in Store for Bitcoin
As the US leads countries holding Bitcoin and the pro-crypto policies expected from the current administration, Bitcoin’s long-term market trajectory is bullish. Although many analysts are optimistic about the future, predictions put Bitcoin at a minimum of $200,000 and even as high as $3 million based on several factors. Regulatory risks and scalability issues persist; Bitcoin will need to surmount more challenges to become the asset everyone wants to hold. But if the world’s premier cryptocurrency has shown us anything, it can return from severe problems to break new levels.
