Understanding the “Bitcoin Effect”

Mark Jeftovic, Grey Swan Investment Fraternity

The “Bitcoin Effect” is what happens when individuals and corporations start to adopt bitcoin onto their balance sheet. You don’t have to go all-in. You can start with a small allocation.

But over time, bitcoin’s hard-capped nature should allow it to rise indefinitely against any fiat currency.

This bitcoin effect is what Michael Saylor is doing with MicroStrategy (MSTR). He’s turned it into an art form.

In essence, the Bitcoin effect is just publicly traded companies saying, we’re going to take our balance sheet cash and we’re going to hold it in Bitcoin instead of cash.

When companies do that, they get rewarded by the market with multiple expansion and share price boosts just by changing their allocation of their dry powder from fiat cash to Bitcoin.

Currently, 52 publicly traded companies now doing that. And many more privately-held ones. My company isn’t publicly traded, but we did something similar.

However, we didn’t just take our cash and put it in the Bitcoin. We were taking Bitcoin as a payment method. We were the first domain registrar to do that back in 2013, and we just kept stacking it.

That’s how we built our stack, and I think we’re going to see more companies using bitcoin payments to build their position as well.

Bitcoin Vs. Bonds: The Superior Savings Method

It’s the Bitcoin standard at the corporate level, swapping out fiat currencies for bitcoin. If you look at the market value of bonds or the market cap of bonds versus the market cap of bitcoin, because it’s a joke now that bonds were supposed to be the risk-free instrument. And now they call ’em return free risk.

It’s return-free risk and there’s 300 trillion of it of this return free risk. And then during the craziest days of the post GFC and the pandemic, there was even 20 trillion of negative yielding bonds out there.

Investors were paying governments to slowly lose money over and above the impact of inflation!

I don’t know how much there is today, but I think that will come back in the future.

So you’ve got all these bonds that are just losing money either nominally either negative interest rates or in real terms. Then you’ve got, roughly, $300 trillion of this stuff that you can’t use for savings anymore.

What’s going to happen to it? I mean, it’s not going to go to zero, but allocators are going to be looking at this and saying, we can’t keep this. We have to get at least some of it out and we have to get it off of this escalator treadmill going this direction.

We have to get it onto an escalator going the other direction. And that’s where bitcoin comes in. That’s where gold comes in. So even if they put, okay, we’re going to cash out 5% of our bond allocation and we’re going to put 4% of it in gold and 1% of it in bitcoin, I mean, that does amazing things for your return over time.

It’s insane what that does to the numbers, especially with bitcoin at a total market cap of about 1.2 trillion right now. Gold’s at about $15 trillion, but half of that is jewelry, so it’s like seven and a half trillion.

It’s just so asymmetrical that it just blows my mind. But what is interesting is to see publicly traded companies and institutional allocators wake up to this and articulate it and say, yeah, we’re kind of starting to park our allocations over here.

We’re just in the early stages of this “Bitcoin Effect” in action, and it’s an amazing thing to see … and any company or person can do it. The sooner you start, the sooner you’ll see a benefit, and the larger the overall benefit will be to you over time. ~~ Mark Jeftovic, Grey Swan Investment Fraternity

Understanding the “Bitcoin Effect”

Mark Jeftovic, Grey Swan Investment Fraternity

The “Bitcoin Effect” is what happens when individuals and corporations start to adopt bitcoin onto their balance sheet. You don’t have to go all-in. You can start with a small allocation.

But over time, bitcoin’s hard-capped nature should allow it to rise indefinitely against any fiat currency.

This bitcoin effect is what Michael Saylor is doing with MicroStrategy (MSTR). He’s turned it into an art form.

In essence, the Bitcoin effect is just publicly traded companies saying, we’re going to take our balance sheet cash and we’re going to hold it in Bitcoin instead of cash.

When companies do that, they get rewarded by the market with multiple expansion and share price boosts just by changing their allocation of their dry powder from fiat cash to Bitcoin.

Currently, 52 publicly traded companies now doing that. And many more privately-held ones. My company isn’t publicly traded, but we did something similar.

That’s how we built our stack, and I think we’re going to see more companies using bitcoin payments to build their position as well.

Bitcoin Vs. Bonds: The Superior Savings Method

Investors were paying governments to slowly lose money over and above the impact of inflation!

I don’t know how much there is today, but I think that will come back in the future.

Trump and Powell are no buddies. They’ve been fighting over rate cuts all year—Trump demanding more, Powell holding back. Even after cutting twice, Trump called him “grossly incompetent” and said he’d “love to fire” him. The tension has been building for months.

And Trump now seems ready to install someone who shares his appetite for lower rates and easier money.

Trump has been dropping hints for weeks—saying on November 18, “I think I already know my choice,” and then doubling down last Sunday aboard Air Force One with, “I know who I am going to pick… we’ll be announcing it.”

He was referring to one Kevin Hassett, who—according to a recent Bloomberg report—has emerged as the overwhelming favorite to become the next Fed chair.

Here we sit — investors, analysts, retirees, accountants, even a few masochistic economists — gathered beneath the leafless monetary tree, rehearsing our lines as we wait for Jerome Powell to step onstage and tell us what the future means.

Spoiler: he can’t. But that does not stop us from waiting.

Tomorrow, he is expected to deliver the December rate cut. Polymarket odds sit at 96% for a dainty 25-point cut.

Trump, Navarro and Lutnick pine for 50 points.

And somewhere in the wings smiles Kevin Hassett — at 74% odds this morning, the presumed Powell successor — watching the last few snowflakes fall before his cue arrives.

With U.S. stocks trading at about 24 times forward earnings, plans for capital growth have to go off without a hitch. Given the billions of dollars in commitments by AI companies, financing to the hilt on debt, the most realistic outcome is a hitch.

On a valuation basis, global markets will likely show better returns than U.S. stocks in 2026.

America leads the world in innovation. A U.S. tech stock will naturally fetch a higher price than, say, a German brewery. But value matters, too.

As copper flowed into the United States, LME inventories thinned and backwardation steepened. Higher U.S. pricing, tariff protection, and lower political risk made American warehouses the most attractive destination for metal. Each new shipment strengthened the spread.

The arbitrage, once triggered, became self-reinforcing. Traders were not participating in theory; they were responding to the physical incentives in front of them.

The United States had quietly become the marginal buyer of the world’s most important industrial metal. China, long the gravitational center of global copper demand, found itself on the outside.