How to Measure True Bitcoin Exposure in Stocks Like MSTR

Jeff Park, Head of Alpha Strategies at Bitwise Asset Management, shared an in-depth Twitter thread offering a new framework for understanding Bitcoin exposure

Investors seeking to capitalize on Bitcoin's price gains might consider investing in stocks like MSTR (NYSE:MSTR) that have significant exposure to the cryptocurrency. However, standard metrics for evaluating Bitcoin exposure in stocks can be misleading.

Jeff Park, Head of Alpha Strategies at Bitwise Asset Management, shared a new framework on Twitter for understanding Bitcoin exposure in equities and investment products.

According to Park, investors may be misled by traditional metrics like “BTC per Share” (BPS) and “BTC Yield.” Instead, he introduced a more refined approach.

The Problem With ‘BTC Per Share’

BPS, calculated as total BTC held divided by total outstanding shares, is often misapplied when analyzing companies like MicroStrategy (NASDAQ:MSTR) or Square (NYSE:SQ) to assess their BTC exposure.

Unlike Bitcoin ETFs, which are simple wrappers around BTC holdings, corporations can use operating leverage—such as issuing debt—to increase BTC on their balance sheet without necessarily diluting shareholders.

For instance, if MSTR raises $500 million in debt to buy more BTC, the BTC numerator in the BPS ratio increases, while the denominator (shares outstanding) remains unchanged. This makes the company appear more BTC-rich per share than it truly is, creating what Park calls “financial alchemy.”

While the BPS goes up, so does the company’s financial risk, which is not visible in the metric alone.

Why ‘BTC Yield’ Is Misleading

Park also criticizes the concept of “BTC Yield,” used to describe the increase in BTC per share over time. He compares it to GDP growth rate: just as a 5% GDP growth doesn't tell you the GDP per capita, BTC Yield doesn’t show you how much BTC per share was truly added.

Moreover, it’s often not annualized and doesn’t reflect real, cash-generating returns. Instead, Park argues investors should care about how much BTC was actually added per share, not just the rate of change.

Introducing ‘True Yield’

To give investors a more accurate perspective, Park proposes a simple metric:

True Yield = % Change in BTC ÷ % Change in Shares Outstanding

This formula corrects for financial engineering tricks by capturing real BTC accumulation relative to shareholder dilution. It helps investors better assess BTC-exposed companies like MSTR and SMLR (Semler Scientific) especially during periods of aggressive capital maneuvers.

This approach allows for a deeper understanding of BTC exposure in a company's stock and enables a more informed investment decision.

The post How to Measure True Bitcoin Exposure in Stocks Like MSTR appeared first on CC Web.

The post How to Measure True Bitcoin Exposure in Stocks Like MSTR appeared first on CC Web.