A couple of weeks after the presidential election, Joe Davy, chief executive of the marketing firm Banzai, sent an email to the company’s board of directors: He wanted Banzai to start buying Bitcoin.
On the face of it, a plunge into the freewheeling world of cryptocurrencies was a strange move for Banzai, a Nasdaq-listed company known for its corporate webinar product. But the election of Donald J. Trump, who embraced Bitcoin on the campaign trail, had galvanized the crypto industry and sent prices skyrocketing. Mr. Davy argued that the investment would protect the company’s finances in case inflation devalued the U.S. dollar, a common but widely contested claim made by crypto enthusiasts.
On Nov. 26, Banzai announced that it would spend up to 10 percent of the funds it held in its corporate treasury on Bitcoin. (The company reported $4.3 million in cash in its latest quarterly report.) “It ended up being a pretty straightforward conversation,” Mr. Davy said in an interview. “It makes sense to own this thing.”
As the price of Bitcoin has soared, a small but growing number of businesses that have nothing to do with crypto — like Banzai — have started to build up stockpiles, linking their financial performance, at least in part, to volatile digital currency markets.
The investments are a sharp pivot away from the cautious approach of the traditional corporate treasury department, whose focus is typically safeguarding cash rather than risking it for a higher return. Typical reserve assets include steady, predictable securities like U.S. government bonds and money market funds.
“I cannot understand how a risk-averse board could justify an investment in digital assets, given we know they swing quite significantly,” said Naresh Agarwal, an associate director at the Association of Corporate Treasurers, a trade organization. “It is quite an opaque market.”
The companies buying crypto are following the example set by MicroStrategy, a business analytics software firm that started amassing Bitcoin in 2020. It has since built a Bitcoin stash that has risen to more than $40 billion, dwarfing the value of its software business. Michael Saylor, the company’s executive chairman and a former Bitcoin skeptic, has become a prominent evangelist for the digital currency.
The strategy has produced astonishing returns for shareholders: MicroStrategy’s stock has risen more than 2,000 percent over the past four years. It now serves as a proxy for the price of Bitcoin, which was worth around $12,000 per coin when the company started buying and surged to a milestone of $100,000 last month.
By one estimate, more than 70 publicly traded companies now invest in Bitcoin, including several that started buying it as Mr. Trump promoted crypto last year. Many of those companies work directly in the crypto industry, like Coinbase, the prominent U.S. exchange. But the group is widening. Rumble, the conservative-leaning social media firm, announced in November that it was planning to spend up to $20 million on Bitcoin. Other firms that have bought the asset include a medical technology supplier, a cannabis grower and Tesla, Elon Musk’s electric vehicle manufacturer.
“We are just believers,” said Bruce Rodgers, the chief executive of LM Funding, a company founded as a real estate debt financing business that shifted to mining Bitcoin a few years ago and held more than $14 million of the cryptocurrency in mid-December. “We are going to accumulate all the coin we can.”
The growing corporate adoption of Bitcoin shows that the cryptocurrency, once dismissed as a passing fad, has attained a semblance of mainstream legitimacy. The purchases also mean that more investors will be exposed, whether they know it or not, to the vagaries of cryptocurrencies, which are prone to sudden surges and precipitous drops. In December, MicroStrategy joined the Nasdaq-100 index, a cornerstone of college savings plans and retirement accounts.
“It’s going to bring crypto and crypto’s volatility into more people’s portfolios whether or not they’re intentionally investing,” said Lee Reiners, a former Federal Reserve official who teaches at Duke University Law School.
Bitcoin did not originate as a corporate investment tool. It was designed to provide the basis for a renegade financial system that would allow people to exchange funds without relying on banks or other intermediaries. Early supporters also envisioned it as a long-term store of value, programmed to have a limited supply so that governments couldn’t print more of it.
The price of Bitcoin has fluctuated wildly over the years, plunging in late 2022 after a series of bankruptcies upended the industry and soaring last year as Mr. Trump promised to ease regulation.
As Bitcoin began to surge in 2024, Semler Scientific, a California company that makes medical devices and builds software for disease detection, settled on a new way to deploy its reserves. The company had considered using the funds to acquire other businesses or buy back its own stock, two common uses of corporate cash.
Ultimately, the company decided to invest all but the cash it needed for day-to-day operations in Bitcoin, beginning in May. Eric Semler, the firm’s chairman, said in an interview that he has spoken with managers of large funds restricted from buying crypto who were looking for other ways to gain exposure to its lofty returns.
“There aren’t many proxies for Bitcoin in the stock market,” Mr. Semler said. “There are reasons to own stocks like ours or MicroStrategy’s that are differentiated.” It means that the company could benefit from both the rising value of the Bitcoin it holds and increased demand for its stock as a crypto alternative. The company’s share price has risen more than 80 percent over the past six months.
Not long after the election, the chief executive of Rumble, Chris Pavlovski, mused online about adding Bitcoin to his company’s balance sheet. Mr. Saylor of MicroStrategy responded: “I would be happy to discuss why & how with you.”
They eventually spoke on the phone, and on Nov. 25, Rumble announced that it was allocating up to $20 million of its excess cash to buy Bitcoin, citing “the election of a crypto-friendly U.S. presidential administration.” Rumble’s stock has jumped about 70 percent in the past month, in part because of a major investment in the company by Tether, a crypto company.
Rumble representatives did not respond to a request for comment.
Not everyone has responded with enthusiasm to the corporate Bitcoin purchases. Mr. Davy, Banzai’s chief executive, said he had fielded some concerned calls from shareholders after the company revealed its plans. In the months before the announcement, Banzai had restructured its debt and completed a one-for-50 reverse stock split to maintain its listing after its share price fell too low.
“People had divisive opinions,” he said of the Bitcoin plan. “I got a couple of phone calls from people who were like: ‘What the hell is going on over there? What are you thinking?’”
And even as the market has surged, some companies have moved to distance themselves from crypto, showing the limits of Bitcoin’s appeal. Last year, Reddit sold most of its crypto holdings, a few months after revealing that Bitcoin was part of its treasury.
In December, the Free Enterprise Project, a conservative advocacy group, introduced a proposal at Microsoft’s shareholder meeting calling for the company to consider putting Bitcoin on its balance sheet. Mr. Saylor praised the effort on social media and gave a presentation to shareholders. The proposal, opposed by Microsoft’s management, was resoundingly defeated, with only around 0.5 percent of shareholders in favor.
“I guess it tells you that mainstream investors still are a little bit blind to the opportunity,” Mr. Saylor said in an interview. “It will be on a lot of other agendas.”
