Central banks in Europe have recently acquired shares of pro-Bitcoin software firm MicroStrategy, potentially making an indirect bet on the popular cryptocurrency. The Norwegian and Swiss central banks purchased 1.1 million and 466,000 MicroStrategy shares, respectively, according to MSTR shareholder data.

Are Central Banks Betting on Bitcoin Through MicroStrategy?

There are a couple of theories as to why these apex banks from two of Europe’s largest economies by gross domestic product invested in MicroStrategy.

One theory suggests that sovereign financial institutions are optimistic about Bitcoin. MicroStrategy is the largest corporate BTC holder in the U.S., with crypto holdings exceeding $13 billion in value. The Tysons Corner-based company began buying Bitcoin in 2020 under the direction of executive chairman and former CEO Michael Saylor. Initially skeptical, Saylor later pitched Bitcoin as a store of value, an inflation hedge, and a superior digital asset.

Given that MicroStrategy is a major Bitcoin buyer, it’s possible that the Norwegian and Swiss central banks sought BTC exposure through MSTR shares. This wouldn’t be unprecedented; in July 2023, financial institutions like Goldman Sachs and asset managers like BlackRock and Fidelity invested millions of dollars in MSTR shares, aligning with Saylor’s pro-Bitcoin stance.

Alternative View: A Strategic Investment

Another perspective suggests that the two central banks view MicroStrategy as a solid investment opportunity. On social media, Patrick Saner, head of macro strategy at Swiss Re, indicated that this could be part of a physical index replication strategy, common among large institutional investors. He emphasized that this move does not necessarily indicate a bullish outlook on Bitcoin from Norges Bank and the Swiss National Bank.

This has nothing to do with what many people see as an implied message that Norges or SNB is now bullish on Bitcoin or MSTR…

Regardless, speculators may view this development as positive for MicroStrategy and Bitcoin adoption. Global BTC adoption has accelerated over the last four years, with El Salvador legalizing BTC and Wall Street spot BTC exchange-traded funds accumulating over $50 billion in assets under management in less than a year.

There have also been discussions of a strategic Bitcoin reserve during U.S. presidential campaigns. Former president Donald Trump has been the most prominent White House aspirant pushing for Bitcoin-friendly policies. Under the current administration, the crypto industry has faced challenges due to a lack of clear regulations and several litigations.

There is hope that the current Democratic ticket, with Vice President Kamala Harris and Minnesota Governor Tim Walz, may improve relations with the digital industry. However, Harris has yet to declare her stance on cryptocurrencies, despite the election being only a few months away. Industry veterans like Coinbase CLO Paul Grewal emphasize that crypto must remain a non-partisan issue.

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