Michael Saylor has once again captured the market's attention with a bold statement: the total reserve capital of his company Strategy (formerly MicroStrategy) now exceeds that of any financial corporation in the S&P 500 index. The only exception is Warren Buffett's legendary Berkshire Hathaway.
However, such an impressive figure requires a sober look. In its investor presentation, Strategy cites a figure of $72.3 billion, but under a more conservative approach, which the company itself uses in official reports, the figure is a more modest $15 billion. The key issue lies in the calculation methodology.
The path to the record: 845,050 BTC on the balance sheet
The foundation of this achievement is a colossal stockpile of bitcoins. Strategy's balance sheet holds 845,050 BTC. The first purchase was made back in August 2020: for $250 million, the company acquired 21,454 coins, which today are valued at approximately $65.2 billion. After a ten-week pause, purchases resumed on August 31, when another 4,603 BTC worth $370 million were added to the portfolio.
Together with $6.7 billion in dollar-denominated assets, total reserves reach $72.3 billion. Notably, Saylor emphasizes that the company does not use net leverage, and dollar-denominated assets almost fully cover debt obligations.
Controversial metric: what's wrong with the calculations
The Total Reserve Capital metric promoted by Strategy does not account for senior claims—that is, obligations repaid first. For banks, these are primarily deposits. This is why JPMorgan's figure goes negative, to approximately -$1.35 trillion.
In Strategy's presentation from August 30, $21.5 billion in senior claims are listed, of which $14.8 billion are preferred shares. Net reserves, meanwhile, stand at $50.7 billion. The $66 billion figure the company credits itself with only appears when preferred shares are excluded from the calculation, which is a rather loose interpretation.
This approach artificially inflates the ratio of reserves to senior obligations. On Strategy's chart, it stands at 10.75, but when preferred shares are included, it drops to 3.4. The company itself describes this indicator in its filings as an "additional metric with significant caveats."
For comparison: Berkshire Hathaway reported $365.5 billion in cash and Treasury bonds as of June 30. That figure is beyond doubt, unlike Strategy's position in the ranking, which directly depends on the chosen methodology.
My take: Saylor masterfully manages the narrative, turning the corporate treasury into a marketing tool. But investors should remember: a metric created by the company itself for its own PR is not an industry standard. Strategy's real financial strength is impressive, yet the comparison with Berkshire Hathaway is more of a rhetorical device than an objective assessment.